Prior to 1917, United States activity in the field of Communications Intelligence¹ was sporadic, and there is little recorded of it. For all practical purposes, the history of American cryptanalysis began with the entry of the United States into World War I. Codes and ciphers at that time, even those used to carry the most sensitive information, were by current standards naive. They were hand‑coded and hand‑applied cipher systems usually overlying double‑entry code books, the attack upon which required skills and patience but not the elaborate electronic and tabulating devices of today. Consequently, the codes which this government "cracked" from 1917 to 1919 were handled by a small group of lexicographers, mathematicians, and people who had acquired some background in what was then the hobby of cipher construction, usually related to some such cult as the "Baconian Theory."

 The War Department set up the first organized cryptanalytic office in June 1917, under Mr. H. O. Yardley, an ex‑State Department telegrapher who had taken some interest in cryptography, or cipher construction. The strength of this office, at first three people, grew rapidly. At the conclusion of the War it was subdivided into functional sections and had a table of organization of some 150 persons with an annual budget of $100,000. Its security regulations were primitive. Ciphers were broken and code values were recovered using hand methods. The volume of traffic handled by the group was nevertheless respectable, and the results of their work on the military, diplomatic and economic fronts were important enough to impress both the General Staff and G‑2. But its budget for fiscal year 1921 ran into opposition, and during the decade was steadily reduced each year, falling at length to $25,000. No research was carried on. There were no training activities, no intercept, no direction finding studies. The personnel fell to six. The coup-de-grâce came in 1929, a few weeks after Mr. Stimson became Secretary of State. By default, the records and physical possessions of H. O. Yardley's "American Black Chamber" fell to the Signal Corps of the Army.

The Navy Department attempted no cryptanalytic work during 1917‑18. But it did set up a system of medium frequency direction finder stations along the Atlantic Coast for tracking German submarines operating in the Western Atlantic. After the Armistice, these Navy coastal D/F stations were diverted to use as aids to navigation and were retained in full operation until the "navigational D/F service" was turned over to the Coast Guard in 1941. Although the U.S. led the world in the development and use of medium‑frequency direction finding, it lagged badly in development of high‑frequency direction finding (HF D/F).