The RAAF Catalina base at Rathmines south of Newcastle was the main flying boat base during World War II and the early 1950s. Port Stephens served as frequent training location for these versatile anti-submarine, air-sea rescue, patrol and minelaying/bombing planes.

During WW2, Port Stephens played host to over 20,000 US and 2,000 Australian troops at HMAS Assault. The base, located on Fly Point Nelson Bay was chosen by Gen Douglas MacArthur as a training location for amphibious landings in the Pacific war against Japan.

Port Stephens was seen as a strategically important defence location against invasion by Japanese Imperial Forces during World War 2. Tomaree Mountain at the southern entrance of Port Stephens became an important part of that defence.