The ship that became the first United States naval vessel to bear the name Arizona was a 950-ton iron side-wheel steamship built as a civilian ship in 1858-1859 at the shipyard of Harlan & Hollingsworth in Wilmington, Delaware for Charles Morgan, the owner of the Southern Steamship Company. As a civilian steamer, the Arizona operated mainly from New Orleans to the Texas coast. Her commercial service ended on 15 January 1862 when Confederate Secretary of War Judah Benjamin ordered Major General Mansfield Lovell to seize her and place her in service as a blockade runner under British registry as the Caroline.
While acting as a blockade runner for the Confederate Navy, the Caroline was carrying munitions from Havana, Cuba to Mobile, Alabama on October 28, 1862. That morning, a lookout on USS Montgomery's, topmast head sighted the blockade runner. Under the command of Charles Hunter, the Union screw gunboat immediately set out in pursuit of the stranger, beginning a six-hour chase. When Montgomery pulled within range of Caroline, she opened fire with her 30-pounder Parrott rifle and expended 17 shells before two hits brought the quarry to. Two boats from the blockader rowed out to the former Arizona and one returned with her master, a man named Forbes, who claimed to have been bound for Matamoros, Mexico, not Mobile. "I do not take you for running the blockade," the flag officer— with tongue in cheek—replied, "but for your damned poor navigation. Any man bound for Matamoros from Havana and coming within twelve miles of Mobile light has no business to have a steamer." The engineer of the Caroline remarked that Hunter "would not have caught them had they had not little steam up".
Farragut sent the prize to Philadephia where she was condemned by admiralty court. The Federal Government purchased her for $84,500 on 23 January 1863. The Navy restored her original name, Arizona, and placed her in commission on 9 March 1863, Lt. Daniel P. Upton in command.