Early service, 1836–1839

On April 4, 1836,^[7] New York commenced a daily passenger-and-mail service from New York to New Haven, replacing the company's steamboat Splendid, which went into reserve. New York initially ran as a passenger-only service, six days a week, while her stablemate, the steamer New Haven, operated a freight service on the same route three days a week. Not long after New York's introduction however, the Post Office insisted upon a seven-day-a-week service, which was duly implemented in spite of company protests. At this time, the passenger fare from New York to New Haven was $2 (equivalent to $55 in 2023). New York and New Haven were to maintain this busy and well patronized service for the next three years.^[4]

On April 25, 1838, New York reportedly made a record-breaking trip from New Haven to New York—a distance of 86 miles (138 km)—in 4 hours and 23 minutes, at an average speed of just under 20 miles per hour (32 km/h).^[9]

Two days earlier, on April 23, the Great Western—the first steamship expressly designed to make regular transatlantic crossings—had arrived in New York, completing her historic maiden voyage.^{[lower-alpha 4]} Great Western's scheduled departure on May 7 attracted much public interest, and numerous steamboat owners arranged excursions for the upcoming event,^[11] including New York's, who advertised a three-hour excursion at fifty cents a head, with onboard entertainment including a brass band.^[12] Other steamboats charged between a dollar and 25 cents for similar services. On the day in question, an estimated 50,000 people turned out to farewell the British ship, with a large fleet of steamboats and other watercraft, including New York, escorting the vessel out of the harbor.^[11]

Fire and change of ownership, 1839–1850

On the night of March 22, 1839, at about 2 am, a fire broke out in New York's fire room while the vessel was docked at New Haven. By the time firefighters arrived, the fire had spread to such an extent that the steamer was towed to shoal waters in the expectation that she would sink. The fire was eventually extinguished, but not before it had destroyed the steamer's upper works, cabin and fittings, as well as much of the customers' luggage, which had been stowed the previous day. The engine was also substantially damaged. Total loss was estimated at more than $40,000 (equivalent to $1,145,000 in 2023), and there was no insurance. With this setback, the New Haven Steamboat Company abruptly suspended its operations and sold its assets, which included the New York, to the Connecticut Steamboat Company, owned by Cornelius Vanderbilt and Memenon Sanford.^[4][3][2]

New York's new owners had the vessel towed to New York, where she was remodeled and rebuilt.^[13] In the meantime, Vanderbilt replaced her on the New York – New Haven route with an old, slow ferryboat named Bolivar. As this vessel fell below the expectations of customers, two opposition parties quickly arrived to take advantage of the situation—the Citizens' Line, which placed the steamboat Telegraph on the route, and Curtis Peck, who transferred his vessel Belle from the Hudson River. Realizing his error, Vanderbilt returned the New York to service in 1841, and from June of that year, a three-way rate war broke out on the route, with fares sometimes dropping as low as 12½ cents. The rate war continued until November 1842, when Peck sold his vessel Belle—which had been the best patronized vessel—to Vanderbilt. Telegraph was withdrawn a short time later.^[4]

New York thereafter continued in service on the Sound with the Connecticut Steamboat Company until 1850.^[13] In October 1843, the steamer broke a crankshaft on her way to New York, and was forced to return to New Haven.^[14] In March of the following year, she broke a crankshaft again, but was able to complete her voyage to New Haven with the use of only one paddlewheel.^[15] In November 1847, New York encountered the Bridgeport steamer Nimrod which had broken down on the Sound, and towed the disabled vessel to Oyster Bay.^[16]

Towboat service, 1851–1875

In 1850, New York was sold to investors from New York state, who in 1851 organized a company, Durant, Lathrop & Co., to operate the vessel. New York subsequently entered service for this company on the Hudson River. By 1854, she had been converted into a towboat, and she would continue to serve in this capacity on the Hudson River for the remainder of her career.^[13]

In 1855, New York was purchased by Schuyler's Line Steam Tow Boats. In 1870, she was acquired by Thomas Cornell. The steamer was abandoned in 1875.^[13]