10 February, 1936: No 49 Squadron re-formed at Bircham Newton, Norfolk, from a nucleus provided by 'C' Flight of No 18 Squadron. It was equipped with Hawker Hind light bombers and initially commanded by F/Lt J.C. Cunningham. In August, 1936 it moved to Worthy Down where at a Station Parade on 14 June 1937, Air Commodore Goble CBE, Air Officer Commanding No.2 (Bomber) Group presented the squadron with its official badge, depicting a racing greyhound surmounting the motto: "Cave Canem" (Beware of the Dog).
Concluding his speech the Air Commodore stated :
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"This, I think, is the first occasion on which an officer of the Dominion Forces has ever presented a badge to a squadron of the Royal Air Force... or any other Air Force and it gives me particular pleasure to hand the badge to your Squadron Commander, S/Ldr W.E. Dipple, for when I commanded a squadron some twenty years earlier, he was one of my good flying officers."

14 March, 1938: Under the command of S/Ldr P. McGregor-Watt, the squadron moved to Scampton in Lincolnshire. At this time the RAF eagerly awaited delivery of the new generation of bombers, namely the Handley Page Hampden and Vickers Wellington. In the meantime, the squadron continued training with their Hawker Hinds.
Hawker Hinds known to have served with the squadron carried the following serials:
| K5384 |
K5385 |
K5402 |
K5412 |
| K5442 |
K5443 |
K5455 |
K6616 |
| K6641 |
K6642 |
K6643 |
K6644 |
| K6645 |
K6646 |
K6647 |
K6713 |
| K6806 |
K6839 |
L7194 |
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Cpl Edwards (left) standing by the wheel of a Hawker Hind at Scampton in 1938 (J. Wilkinson)
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