The three primary missions of the Bangladesh Navy are to maintain sovereignty over the nation's territorial waters, to safeguard Bangladesh's economic interest and exercise maritime control within the exclusive economic zone and the continental shelf, and to protect Bangladeshi shipping. During the Pakistan era (1947-71), the navy was accorded a low priority. Pakistani leaders were preoccupied with maintaining the West Wing's land defenses against India. The Mukti Bahini did not have a naval force, other than a few frogmen who sabotaged Pakistani merchant ships. Wartime naval operations, including an amphibious landing near Chittagong, were left entirely to the Indian Navy. As a result, at independence, Bangladesh inherited virtually nothing in the way of naval equipment or personnel.

Founded as a separate military service on April 7, 1972, the Bangladesh Navy started with a nucleus of twelve officers and 1,000 seamen, most of whom had served in the Pakistan Navy. Their equipment included six captured speedboats and some miscellaneous small arms. From these humble beginnings, the Bangladesh Navy grew into a coastal and riverine defense force estimated in 1988 to include 600 officers and 6,900 enlisted personnel. The navy's center of operations and training was at the country's major port, Chittagong, where, in 1988, the new Bangladesh Naval Academy began its first academic year. Navy headquarter was in Dhaka. Smaller naval facilities were located at Kaptai and Khulna.

The most formidable ships in the navy were three vintage frigates purchased from Britain in the late 1970s. These included two Leopard-class Type 41 frigates, renamed Abu Bakr and Ali Haider, and one Salisbury-class Type 61 frigate, renamed Umar Farooq. The most modern craft in the inventory were twenty-four patrol boats purchased from the Chinese between 1982 and 1984. These included four Hegu-class fast attack craft, armed with missiles four P4-class fast-attack craft, armed with torpedoes and eight Hainan-class and eight Shanghai II-class fast attack patrol craft. These vessels patrolled coastal waters and rivers to interdict foreign fishing vessels and assert Bangladeshi sovereignty over its territorial waters. Other vessels in the Bangladeshi inventory included vintage patrol craft purchased from China, Yugoslavia, India, Japan, and Singapore a recommissioned Pakistani patrol boat a similar craft converted from a Thai fishing boat and five indigenously built Pabna-class riverine patrol craft. Bangladesh also maintained a merchant fleet comprising 274 vessels. Since all were government owned, merchant vessels could be pressed into service during hostilities. In the late 1980s, the Bangladesh Navy had no air wing, marine corps, or reserves.

Data as of September 1988