Built at Saffold near the Florida line, she was an active defender of the Apalachicola, Chattahoochee and Flint River system. The ship was raising steam on the Apalachicola River during an unusual May hurricane in 1863 when she sank in a tragic accident. A faulty gauge caused the accident, in which the gunboat's crew released water into a super-heated boiler. The resulting steam explosion scalded 16 men to death in an instant and severely burned several other men. Afraid that the ship's magazines might explode, her crew sank her to deck level in the muddy river. Taken to Columbus and repaired, the CSS Chattahoochee was started downstream by her crew as Union troops attacked the city in 1865. They made it a few miles, but ultimately abandoned their ship after setting her afire themselves and the gunboat burned to the waterline and sank to the bottom of the Chattahoochee River. Her stern section was raised during the 1960s and is now on display in the National Civil War Naval Museum.
After the end of the civil war, Chattahoochee served as Susquehanna and flagship of the North Atlantic Squadron. She was decommissioned at the New York Navy Yard on January 14, 1868 and sold for scrap in 1883.