Recommissioned in May 1867, she was attached to the Asiatic Squadron and continued in that capacity until January 1870.

Oneida departed from Yokohama, Japan on 24 January 1870, on passage back to the United States.
Some 12 miles into this voyage, she was struck by the British Peninsula & Oriental steamer Bombay, at 6:30 pm near Saratoga Spit.
The Court of Inquiry unanimously held that the officers of Oneida were entirely to blame for the collision.
The Oneida was under the command of an inexperienced junior officer whilst the senior officers were at dinner.
On seeing a light ahead, this young officer had sought the advice of a navigating officer who briefly came on deck and then returned to dinner.
Confusing helm orders were given on Oneida, with the result that Bombay's efforts to avoid collision were in vain and she struck Oneida at an angle of 45 degrees, abaft the mizzen chains.
The starboard quarter was cut off Oneida and she sank at 6:45 pm in 20 fathoms (37 m) of water with the loss of 125 men, 61 sailors being saved in two Japanese fishing boats.
The loss of life on the Oneida was compounded by a shortage of boats: 3 of the ship's boats had been lost in a typhoon the previous August and not replaced, 2 were destroyed in the collision, leaving only 2, which were lowered immediately.

There is controversy over the subsequent actions of Captain Eyre of the Bombay.
He was accused of steaming on without rendering assistance.
He had his certificate suspended for 6 months by the Court of Inquiry and the ship itself was libeled, meaning that steamer and other ships of the P.& O. Line were kept away from American ports.
The findings of the Inquiry were debated in the House of Commons, with speakers making clear that Bombay remained at the position of the collision for, by varying reports, between 5 or 6 minutes and 10 or 12 minutes, whilst Oneida carried on under full sail and steam, with a full tide under her.
No indication of distress from Oneida were seen or heard on Bombay (Oneida's crew admitted they did not show any blue lights), it would have been time-consuming to turn the ship in a narrow channel, making the provision of any useful help impossible, and the position of Oneida was not clear as she was not showing any lights.
Furthermore, there was damage to Bombay, with 9 feet of water in the forward compartment, the ship was 18 years old and carrying a number of passengers.

The wreck of the Oneida was sold at public auction at Yokohama 9 October 1872, to Mr. Tatchobonaiya.
Inside the wreckage were found many of the bones of the dead sailors, which were interred, at the expense of the salvagers, on the grounds of Ikegami Temple in Tokyo.
In Jinrikisha Days in Japan (1891), Eliza Ruhamah Scidmore tells the story, writing:
...[the American] government made no effort to raise the wreck or search it, and finally sold it to a Japanese wrecking company for fifteen hundred dollars.
The wreckers found many bones of the lost men among the ship's timbers, and when the work was entirely completed, with their voluntary contributions they erected a tablet in the Ikegami grounds to the memory of the dead, and celebrated there the impressive Buddhist segaki (feast of hungry souls), in May 1889.
The great temple was in ceremonial array; seventy-five priests in their richest robes assisted at the mass, and among the congregation were the American admiral and his officers, one hundred men from the fleet, and one survivor of the solitary boat's crew that escaped from the Oneida.

The Scriptures were read, a service was chanted, the Sutra repeated, incense burned, the symbolic lotus-leaves cast before the altar, and after an address in English by Mr. Amenomori explaining the segaki, the procession of priests walked to the tablet in the grounds to chant prayers and burn incense again.
Recommissioned in May 1867, she was attached to the Asiatic Squadron and continued in that capacity until January 1870.
Oneida departed from Yokohama, Japan on 24 January 1870, on passage back to the United States. Some 12 miles into this voyage, she was struck by the British Peninsula & Oriental steamer Bombay, at 6:30 pm near Saratoga Spit. The Court of Inquiry unanimously held that the officers of Oneida were entirely to blame for the collision. The Oneida was under the command of an inexperienced junior officer whilst the senior officers were at dinner. On seeing a light ahead, this young officer had sought the advice of a navigating officer who briefly came on deck and then returned to dinner. Confusing helm orders were given on Oneida, with the result that Bombay's efforts to avoid collision were in vain and she struck Oneida at an angle of 45 degrees, abaft the mizzen chains. The starboard quarter was cut off Oneida and she sank at 6:45 pm in 20 fathoms (37 m) of water with the loss of 125 men, 61 sailors being saved in two Japanese fishing boats. The loss of life on the Oneida was compounded by a shortage of boats: 3 of the ship's boats had been lost in a typhoon the previous August and not replaced, 2 were destroyed in the collision, leaving only 2, which were lowered immediately.
There is controversy over the subsequent actions of Captain Eyre of the Bombay. He was accused of steaming on without rendering assistance. He had his certificate suspended for 6 months by the Court of Inquiry and the ship itself was libeled, meaning that steamer and other ships of the P.& O. Line were kept away from American ports. The findings of the Inquiry were debated in the House of Commons, with speakers making clear that Bombay remained at the position of the collision for, by varying reports, between 5 or 6 minutes and 10 or 12 minutes, whilst Oneida carried on under full sail and steam, with a full tide under her. No indication of distress from Oneida were seen or heard on Bombay (Oneida's crew admitted they did not show any blue lights), it would have been time-consuming to turn the ship in a narrow channel, making the provision of any useful help impossible, and the position of Oneida was not clear as she was not showing any lights. Furthermore, there was damage to Bombay, with 9 feet of water in the forward compartment, the ship was 18 years old and carrying a number of passengers.
The wreck of the Oneida was sold at public auction at Yokohama 9 October 1872, to Mr. Tatchobonaiya. Inside the wreckage were found many of the bones of the dead sailors, which were interred, at the expense of the salvagers, on the grounds of Ikegami Temple in Tokyo. In Jinrikisha Days in Japan (1891), Eliza Ruhamah Scidmore tells the story, writing:
...[the American] government made no effort to raise the wreck or search it, and finally sold it to a Japanese wrecking company for fifteen hundred dollars. The wreckers found many bones of the lost men among the ship's timbers, and when the work was entirely completed, with their voluntary contributions they erected a tablet in the Ikegami grounds to the memory of the dead, and celebrated there the impressive Buddhist segaki (feast of hungry souls), in May 1889. The great temple was in ceremonial array; seventy-five priests in their richest robes assisted at the mass, and among the congregation were the American admiral and his officers, one hundred men from the fleet, and one survivor of the solitary boat's crew that escaped from the Oneida. 
The Scriptures were read, a service was chanted, the Sutra repeated, incense burned, the symbolic lotus-leaves cast before the altar, and after an address in English by Mr. Amenomori explaining the segaki, the procession of priests walked to the tablet in the grounds to chant prayers and burn incense again.
USS Oneida (1861)