The squadron was activated in 1967, and took over the DeHavilland Canada C-7A Caribou aircraft operated by the 57th Aviation Company (U.S. Army) and its tactical airlift mission in South Vietnam. It operated from several locations in addition to its primary base at Vung Tau Airfield. The 535th airlifted routine cargo and passengers, provided support for Army special forces and radio relay for ground units, airdropped troops and cargo, performed emergency resupply and medical evacuation, and flew other combat airlift missions. It earned a Navy Presidential Unit Citation, as well as an Air Force Presidential Unit Citation for airlift support of Khe Sanh and other forward bases from January to May 1968. It earned a second Air Force Presidential Unit Citation for action between April and June 1970 when it participated in the aerial resupply of Dak Seang Special Forces Camp, evacuation of over 2000 refugees from Cambodia, and transportation of the Presidential Southeast Asia Investigation Team to various remote locations in South Vietnam. The squadron flew its last combat mission the day it was inactivated.