"James K. Paulding" joined the Scouting Fleet January 1923 and throughout the year engaged in tactical war problems designed to maintain the fleet in the best possible fighting condition. She continued these operations in addition to reserve training until she sailed in February 1925 to San Diego, California for war problems in the Pacific. Upon her return to Newport 31 August, she resumed her duties with the Scouting Fleet. While engaging in gunnery exercises in Caribbean waters November 1926, "James K. Paulding" sailed to Nicaragua to protect American interests in the wake of political turmoil in that country. During March and April 1927 she remained off Nicaragua to prevent any smuggling of arms.