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No.167 Squadron was formed during November 1918 at Bircham Newton as the second heavy bomber squadron in No.27 Group. It was intended to operate Handley Page V/1500 four-engined bombers but the Armistice came before bombing raids on Germany could begin and the squadron disbanded on 21 May 1919.

On 6 April 1942, No.167 reformed at Scorton as a fighter squadron and became operational on 8 May. Next month it arrived back in the north of Scotland to provide air defence for the fleet base at Scapa Flow and coastal convoys. In October 1942, the squadron moved to East Anglia for shipping reconnaissance and intruder missions over the Low Countries. Many of the pilots flying with No.167 were Dutch and it was decided to make the Squadron a Wholly Dutch Formation. This took place on the 12 June 1943, when it was renumbered 322 Squadron.

On 21 October 1944, No.167 reformed at Homsley south as a transport squadron in No.110 Wing. Warwicks were received in November and began flying regular services to various allied bases in Europe and West Africa. In May 1945, a flight of Ansons was operated on short-range routes. In July Warwicks were taken out of service for technical problems to be solved, crews in the meantime flying Dakotas with No.147 Squadron until Warwicks resumed operating in September. On 1 February 1946, the squadron was disbanded.

On 1 February 1953, No.3 (Long-range) Ferry Unit at Abingdon was redesignated No.167 Squadron. It was engaged in ferrying aircraft to units overseas until it merged with No.147 Squadron to form the Ferry Squadron on 15 September 1958.

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