No. 36 Squadron handed over its six Dakotas to No. 38 Squadron in July 1958, prior to re-equipping with the Lockheed C-130 Hercules. It returned to Richmond in August, followed by the rest of No. 86 Wing a month later. After conversion training of its personnel in the United States, No. 36 Squadron became the first non-US operator of the Hercules in December 1958, when it began taking delivery of twelve C-130As; deliveries completed in March 1959. The official history of the post-war Air Force described the Hercules as "probably the biggest step-up in aircraft capabilities" the RAAF had ever received, considering it roughly four times as effective as the Dakota, taking into account the improvements in payload, range, and speed. In September 1960, No. 36 Squadron began parachute trials on the Hercules. It made the Hercules' first troop-carrying flights into a combat zone in December 1962, joining a Commonwealth airlift from Singapore to Borneo at the onset of the "Konfrontasi" between Indonesia and Malaysia; similar missions were undertaken over the next five years. The squadron was again awarded the Gloucester Cup in 1963.