New Guinea campaign

James E. Craig departed Espiritu Santo on 13 February with three other escorts and seven merchant ships bound for Guadalcanal. Upon arrival the 16th, she began anti-submarine patrol off Lunga Point. She departed for Espiritu Santo on 23 February, escorting two merchant ships and continued her escort duty between Guadalcanal and Espiritu Santo for several weeks. On 15 March, she escorted the oiler Cacapon from Espiritu Santo to a fueling rendezvous with Task Force 36, which was engaged in operations against Kavieng, New Ireland, and Emirau Island, "the last link in the ring around Rabaul." Refueling completed the 25th, James E. Craig and Cacapon joined other escorts and tankers and returned to Espirito Santo.

On 31 March, James E. Craig departed Espiritu Santo in company with Escort Division 37, including Lovelace, Manning, Neuendorf and Eichenberger. Stopping at Tulagi in the Solomons, 2 to 4 April, they sailed the 5th for New Guinea, where James E. Craig was to see action for five months.

On 26 April, James E. Craig joined a convoy of escorts and transports bound from Cape Sudest to Humboldt Bay to support the invasion of Hollandia, underway since the 22nd. The convoy arrived on 3 May; and after discharging the transports, the escorts returned to Cape Sudest the 5th. James E. Craig, now under the command of Lieutenant Commander Edward F. Andrews, steamed on 13 May on escort duty to Humboldt Bay via Aitape, arrived the 17th, and immediately joined an attack convoy bound for Wakde Airfield, Sawar Airfield and Sarmi, west of Hollandia. She returned the same day to Humboldt Bay, where she continued her patrols and escort duty. She bombarded enemy troop concentrations between Wakde and Sarmi on the 27th and returned to Cape Cretin via Humboldt Bay on the 31st.

James E. Craig returned to Humboldt Bay on 6 June to prepare for the bitter Battle of Biak. With six other escorts, she accompanied the convoy and supported the landing operations on 12 June. Departing the same day, the convoy returned to Humboldt Bay the 14th; and James E. Craig continued as escort to Cape Cretin, where she arrived three days later.

During the remainder of June and through July, James E. Craig continued escort and anti-submarine duties along the northern coast of New Guinea. While on ASW operations off Wakde, she conducted prolonged, successful bombardments of enemy supply depots at Sawar, 11–12 July, expending some 3,300 rounds of 3-inch and 1.1-inch shellfire. A week later, she arrived at Noemfoor Island, southwest of Biak, and escorted convoys 18 to 23 July on a triangular route from Noemfoor to Humboldt Bay via Biak. Arriving at Madang, Astrolabe Bay, on 23 July for overhaul, James E. Craig returned to Humboldt Bay to resume her escort and ASW operations.

During August, she plied the coastal waters off New Guinea from Cape Cretin to Wakde; then devoted the six weeks to escort and anti-submarine patrol between Cape Cretin, Manus Island, and Humboldt Bay. On 11 October, she joined a convoy at Ulithi, then sailed for the Palaus on the 18th and arrived Peleliu two days later for ASW operations. She returned to Manus the 25th for repairs.

Philippines campaign

Back at Humboldt Bay on 14 November, she joined a large convoy of transports, amphibious craft, and escorts underway on the 17th for the Philippine Islands, to support the vital, Allied foothold on Leyte, established some four weeks earlier. The convoy of 75 ships and 9 escorts steamed northwestward and by dusk of the 23rd approached Leyte Gulf.

James E. Craig, returning from radar picket patrol to her assigned ASW station, made radar contact with six low-flying unidentified planes approaching from the south at approximately 190 knots (219 mph; 352 km/h). Soon her spotters observed "Jill" torpedo bombers 7 miles (11 km) out, closing at high speed. As the enemy aircraft broke into three groups in an attempt to "box the target," James E. Craig turned left full rudder to meet the attackers; and all guns which could bear commenced firing at the aircraft, still more than 2 miles (3 km) out. Four of the attackers began a run and launched their torpedoes at a range of 1,000–1,500 yards to port; as the ship turned, three torpedoes passed "close aboard to port" and almost parallel to her. Meanwhile, two aircraft commenced a run from the starboard side. Approaching almost directly from out of the sunset, one dropped a torpedo within a thousand yards which broached once before settling down on its run. As James E. Craig turned hard to starboard, the torpedo passed within 5 yards (5 m) astern. One of the attackers passed within 200 yards (200 m) of the ship, was hit by starboard 20 mm gunfire, and splashed after passing over frigate El Paso (PF-41).

The convoy stood into San Pedro Bay, Leyte, the following day, and remained at battle stations a greater part of the day to repel enemy aircraft which attempted to bomb the convoy. That night, the convoy and escorts reformed and departed for Humboldt Bay via the Palaus.

Upon arrival, James E. Craig received general maintenance and overhaul from destroyer tender Dobbin (AD-3) through 10 December. She spent the remainder of the month escorting fleet tankers and practicing anti-aircraft and night torpedo firing drills at Padaido, Dutch East Indies, and Humboldt Bay. On 28 December, Escort Division 37 departed Humboldt Bay with a convoy of tankers and merchant ships bound for Leyte, where they arrived on 1 January 1945.

Decommissioning

James E. Craig remained at Subic Bay until 1 October, when she steamed for the United States via Eniwetok and Pearl Harbor. She arrived San Diego on 5 November and decommissioned there on 2 July 1946. She was struck from the Navy List on 30 June 1968.