Stars and Stripes served the Union Navy primarily as a screw gunboat, and as a tugboat when necessary, in the blockade of the rivers and ports of the Confederate States of America.

[1]: 377, 389  On 5 and 6 November, the ships under Lt. Werden's command attempted to provide assistance to the French corvette Prony which had run aground, but between concern for the weather and Rebel activity, proved unable to do so.

[1]: 555–557  On 20 February while transferring ammunition to the Isaac N. Seymour, that ship struck the submerged anchor of the Louisiana and was sunk, with most of her crew brought aboard the Stars and Stripes.

Stars and Stripes returned to Norfolk, Virginia, on 4 June for repairs and sailed on the evening of the 10th for blockading duty off Wilmington, North Carolina.

On 24 August, Stars and Stripes captured British ship Mary Elizabeth attempting to slip into Wilmington with a cargo of salt and fruit.

The ship operated in merchant service until, while steaming from Philadelphia to Pará, Brazil, she was wrecked on the outer bar of Currituck Beach, North Carolina, on the evening of 31 January 1878.