Shadow III patrolled the Florida coast off Miami during World War I. After the war, she acted as an aircraft crash boat for Naval Air Station Miami, Florida.
Shadow III was decommissioned at Miami on 25 January 1919. The Navy delivered her to the Parris Island Marine Corps Base at Parris Island, South Carolina, on 1 August 1919 for further non-commissioned service.
In December 1919, Shadow III was taken to the Charleston Navy Yard at Charleston, South Carolina, for survey. She was sold on 5 August 1921 to Mike Letiff of Charleston.