Irving Berlin wrote an early version of the song in 1918 as American forces prepared to join what would come to be known as World War I. But the song wasn't widely performed until it was revised in 1938 when a second conflict threatened to disrupt Europe's peace.
It's this 1938 version that we sing today, and the song is best remembered as set in the United States around this time, as Americans nervously watched Europe in the fear that war was inevitable.
In November 1938, Hitler's German army had just invaded and occupied the Sudetenland, a portion of Czechoslovakia. Seven months earlier, Germany had invaded and annexed Austria, and two years before that, Hitler had placed troops along the German-French border in violation of the Treaty of Versailles. As Europe marched toward war, American citizens and policy makers took steps to ensure American neutrality in future conflicts.
In part, this ambition was fueled by critics of American involvement in World War I who argued that greedy munitions manufacturers had drawn the country into war. Anxious to profit by selling goods to the French and British armies, they had shipped cargoes across the Atlantic and into the crosshairs of German submarines. Once American vessels were attacked and American lives were lost, American intervention in the war was impossible to avoid.
To prevent the nation from being similarly drawn into war again, Congress passed a series of neutrality acts between 1935 and 1937. These prohibited the sale of munitions and other war supplies to countries at war, and they warned Americans traveling into war zones that they did so at their own risk. One act also prohibited the extension of loans to warring countries.
Irving Berlin re-wrote and re-introduced his 1918 song amidst a general concern that a European war was brewing and should be avoided. As a reflection of these peaceful ambitions, he changed some lyrics that he believed were better suited to the martial spirit of 1918, and he presented the song to Kate Smith to perform on November 11th, 1938 (Armistice Day), the annual holiday celebrating the end of World War I.