She commissioned on 3 June 1899, Ensign Harris Laning in command.

Throughout the Philippine–American War, Panay served on blockade and patrol duty, intercepting contraband and aiding the Army on Mindanao, Leyte, Cebu, Samar, and Negros.

The Panay was originally built by Spain, and bought by the U.S.in 1899 after the Spanish–American War.

Assigned to patrol Mindanao, Nimitz—who was to be Commander-in-Chief Pacific in World War II as a Fleet Admiral—took Panay—his first command—into many of the small ports to show the flag.

Panay—not to be confused with the later ship sunk by the Japanese in 1937—served as a yard craft at Olongapo and Cavite and as a ferryboat between Cavite and Manila in the years that followed, even after she was struck from the Navy List on 19 June 1914.