On 30 July 1942, the Army Ground Forces ordered the activation of two airborne divisions not later than 15 August 1942. The 82nd Division, an Organized Reserve division that had been ordered into active military service in March 1942, was ordered to provide cadre to the 101st Division, the other division selected for the project, for all elements except parachute infantry. As part of the reorganization of the 101st Division as an airborne division, the unit was disbanded on 15 August 1942 and reconstituted and reactivated in the Army of the United States. On 19 August 1942, its first commander, Major General William C. Lee, read out General Order Number 5:

The regiment was initially formed during World War II at Camp Toccoa, Georgia, in 1942 where it earned its nickname, "Currahees", after the camp's Currahee Mountain. Paratroopers in training ran from Camp Toccoa up Currahee Mountain and back with the shout "three miles up, three miles down!". TheCherokee word, which translates to "Stand Alone", also became the unit's motto. Members of the unit wear the spade (♠) symbol on the helmet outer and the Screaming Eagle patch (indicating membership in the101st Airborne Division) on the left sleeve. Its first commanding officer was Colonel Robert F. Sink , and the 506th was sometimes referred to as the "Five-Oh-Sink". On 10 June 1943, the 506th Parachute Infantry Regiment officially became part of the 101st Airborne Division, commanded byMajor General William Lee, the "father of the U.S. Army Airborne".

Sink read in Reader's Digest about a Japanese Army unit that held the world record for marching. Sink believed his men could do better, so he marched the regiment from Camp Toccoa to Atlanta: 137 miles (220 km) in 75 hours and 15 minutes, including 33.5 hours of actual marching. Only 12 of the 2nd Battalion's 556 enlisted men failed to complete the march. All 30 officers completed it, including 2nd Battalion commanderMajor Robert Strayer. Newspapers covered the march; many civilians turned out to cheer the men as they neared Five Points. In Atlanta, they boarded trains for Airborne School in Fort Benning, Georgia.

The 506th would participate in three major battles during the war: D-day landings, Operation Market Garden, and the Battle of the Bulge. (They would have participated in Operation Varsity, but SHAEF decided to use the 17th Airborne Division instead.) 

D-Day: Operation Overlord

Like almost all paratrooper units, the 506th was widely scattered during the Mission Albany night drop on the morning of D-Day. The most famous action for the 506th on D-Day was the Brécourt Manor Assault led by 1st Lieutenant Richard Winters. Later, they fought in the battle for Carentan.

The unit had been promised that they would be in battle for just three days, but the 506th did not return to England for 33 days. Of about 2,000 men who jumped into France, 231 were killed in action, 183 were missing or POWs, and 569 were wounded — about 50% casualties for the Normandy campaign.

Operation Market Garden

The airborne component of Operation Market Garden, Operation Market was composed of American units (82nd Airborne Division, the 101st Airborne Division, and the IX Troop Carrier Command), British units (1st Airborne Division) and Polish units (1st Independent Parachute Brigade). The airborne units were dropped near several key bridges along the axis of advance of the ground forces, Operation Garden, with the objective of capturing the bridges intact in order to allow a deep penetration into the German-occupiedNetherlands and to capture the key bridge crossing the River Rhine at Arnhem.

The 101st Airborne was assigned five bridges just north of the German defensive lines northwest of Eindhoven. The daylight schedule resulted in well-targeted and controlled drops into the designated zones. The 101st captured all but one bridge, the one at Son, which its German defenders blew up as the airborne units approached. The ground forces ofBritish XXX Corps linked up with elements of the 101st Airborne on the second day of operations but the advance of the ground forces was delayed while engineers replaced the Son bridge with aBailey bridge . XXX Corps then continued its advance into the 82nd Airborne's area of operations where it was halted just shy of Arnhem due to German counterattacks along the length of the deep penetration.

The 101st Airborne continued to support XXX Corps advance during the remainder of Operation Market Garden with several running battles over the next several days.

Battle of the Bulge

The 506th fought in the Battle of the Bulge from December 1944-January 1945. In December, the unit, along with the rest of the 101st Airborne Division, was resting and refitting in France after Operation Market Garden. On 16 December, General Dwight D. Eisenhower, the Supreme Allied Commander on the Western Front, ordered them to move into the Belgian town of Bastogne by 18 December, so that the Germans would not gain access to its important crossroads. The short-notice move left the unit short of food, ammunition, arms, men, and winter clothing. The unit, along with the rest of the 101st Airborne, was encircled immediately. The 506th was sent to the eastern section of the siege. During the siege, there were reports of problems with tying in the gap in between the501st PIR and the 506th. To stall the Germans so that the defense could be set up, the 1st Battalion of the 506th (along with Team Desobry from the10th Armored Division) was sent out to fight the Germans in the towns of Noville and Foy. One-third (about 200 men) of the battalion were killed or wounded, but the unit took out 30 enemy tanks and inflicted 500 to 1,000 casualties. The battalion was put into reserve and the 2nd and 3rd Battalions were put on the lines. A supply drop on 22 December helped to some extent. After theU.S. Third Army, under General George Patton , broke the encirclement, the 506th stayed on the line and spearheaded the offensive by liberating Foy and Noville in January. They were then transferred toHaguenau and pulled off the line in late February 1945.

Rest of the war

The regiment was put back on the line on 2 April, and continued for the rest of the war, taking light casualties. It helped encircle theRuhr Pocket and capture Berchtesgaden, then took up occupational duties in Zell am See, Austria. The 506th then began training to be redeployed to the Pacific theater but the war ended in August 1945.