During July - August 1931, Chicago operated in the Atlantic Ocean off the east coast, where she became the flagship of commander cruisers, scouting force. During the 1930s, regularly participated in fleet exercises. On May 31, 1934 she was present at the Naval review held at New York City for President F. D. Roosevelt. Later in the year the Chicago moved to San Pedro, where she remained until September 1940, when transferred to Pearl Harbor.
On May 4, 1942 supported the USS Yorktown CV-5 carrier aircraft attacking Tulagi then participated in the Battle of the Coral Sea. On May 7, 1942 Chicago was lightly damaged in an enemy air attack, suffering suffered several casualties from strafing.
On May 31, 1942 Chicago was anchored in Sydney Harbor, and targeted by Midget Submarine M24, that fired two torpedoes. Both missed, passing under the Dutch submarine K-9 and exploded against the sea wall of Garden Island, lifting HMAS Kuttabul out of the water and sinking it and killing 21 sailors aboard. Chicago fired on the midget submarine.
Battle of Savo Island
Withdrawn from the area the next day, Chicago proceeded to Nouméa where temporary repairs were performed before proceeding to Sydney Harbor for further repairs, arriving at San Francisco on October 13, 1942. Two days later, arrived at Mare Island Navy Yard where permanent repairs and an overhaul were completed by early January 1943.
G4M1 Betty piloted by Bunzaburo Imamura's was shot down astern of USS Chicago. The impact and flames on the surface provided illumination for other bombers to make torpedo attacks. Soon afterwards, Chicago was hit by two aerial torpedoes in the starboard hull. The damage caused severe flooding and loss of power, forcing the crusier to be taken under tow.
The next evening on January 30, 1943, eleven G4M1 Betty bombers from 751 Kokutai made another attack, but were intercepted by F4F Wildcats from VF-10. During this attack, Chicago was hit by four more torpedoes at 16:24, one further damaging the starboard side. Seventeen minutes later, the cruiser sank stern-first. Chicago received three battle stars.
Former Captain Howard D. Bode's actions during the Battle of Savo Island were questioned in a US Navy inquiry headed by Admiral Hepburn. Though the report was not intended to be made public, on April 19, 1943 Bode learned of its implications and shot himself, dying the following day.