By the time of the Civil War, there were settlements of Jewish Americans in every state and territory in the Union. Anti-semitism existed in many locations. One example is the case of Captain Uriah P. Levy of the US Navy, who was dismissed from the Navy. Levy asserted that religious discrimination was the reason for his dismissal and, in 1857, attempted to be reactivated to service. The naval board reinstated him, and he eventually became a commodore, commanding the Mediterranean Fleet. Levy is credited with abolishing corporal punishment in the Navy; and he later restored Thomas Jefferson's estate and gave it to the federal government in his will.

With no central authority or hierarchy to determine official policy, the Jewish American community took no position on slavery and secession. Actions and policies were determined by individual congregations and people. As a result, the American Jewish community was split. Some opposed slavery; like August Bondi, the Wiener brothers and Jacob Benjamin, who went to Kansas to join abolitionist John Brown in his fight against slavery. Rabbi David Einhorn of Baltimore, Maryland, strongly opposed slavery, and used his German-language newspaper, "Sinai," to promote abolitionism. In 1861, he was forced to flee Baltimore. Others chose to support Confederate interests, like Judah Philip Benjamin, a prominent member of the Confederate Cabinet. In January of 1861, Rabbi Morris J. Raphall of New York City preached a message to his congregation presenting a biblical defense of slavery. As in most American communities, the majority of Jewish Americans took no position, or at least no action, one way or the other, especially with regard to slavery.

During the Civil War, over 6,000 Jewish Americans fought for the Union. Jewish Americans fighting in the armed forces often faced difficulties in observing the practices and rituals of their religion. In addition to facing the ridicule of their peers, they had to make do with the time and materials available for them to celebrate the Sabbath, as well as important holidays like Yom Kippur and Passover. The mainstream American press shared responsibility for perpetuating anti-semitism. While the New York "Herald" faithfully reported Jewish American Confederate spies, it failed to report Jewish American casualty lists or heroic acts.

Jewish Americans in the military faced discrimination even from the establishment itself. Rabbis were not permitted as chaplains to the thousands of Jewish Americans troops. In 1861, Rabbi Arnold Fischel presented to the US Senate Committee on Military Affairs a statement, charging that "Jewish ministers [were] being by law excluded from the office of chaplain in the Army." Finally, on July 1, 1862, Congress allowed Jewish chaplains to perform their duties for the Jewish members of the US armed forces.

The most drastic act of anti-semitism during the war, however, was Gen. Ulysses S. Grant's General Order No. 11. Released in December of 1862, it stated that: "the Jews, as a class violating every regulation of trade established by the Treasury Department, are hereby expelled from the department within twenty-four hours from receipt of this order." The Jewish community raised an outcry. In January of 1863, President Lincoln wired General Halleck, who told General Grant that "the President has no objections to your expelling traitors and Jew peddlers, which, I suppose, was the object of your order, but as it is in terms [which] proscribe an entire religious class, some of whom are fighting in our ranks, the President deemed it necessary to revoke it."

President Lincoln's assassination took place during the Jewish Feast of Passover in 1865. Lincoln's efforts on behalf of Jews had touched many Jewish Americans, and they mourned his passing with the rest of the nation. In cities like New York, Boston, San Francisco and Los Angeles; Jewish Americans played prominent roles in memorial tributes to the slain President.