The Miami Seahawks were the last of the AAFC's charter teams to be established. They were formed to replace an aborted Baltimore franchise which was to have been owned by retired boxer Gene Tunney. However, Tunney's bid foundered when he was unable to secure a stadium deal with old, city-owned "Municipal Stadium" on 33rd Street, built in 1922 in the former Venable Park of northeast Baltimore (site of future "Memorial Stadium", rebuilt 1950–1954). A group of Miami football boosters led by Harvey Hester seized on the chance to bring a major league team to their city. The AAFC, needing an eighth team to balance the schedule, readily granted Hester a franchise. The Seahawks thus became the first major league sports team to be based in Miami. Home games were played at Burdine Stadium, later called the Miami Orange Bowl.
The Seahawks stood out from the other AAFC franchises in several ways. First, Miami was by far the smallest market in the league, with roughly half the population of most other metropolitan areas with professional football teams. Indeed, the only city in the NFL and AAFC that was smaller was Green Bay. Although Miami was beginning a period of growth that continues today, it was only the 42nd-largest city in the United States at the time, while the other AAFC cities were among the 15 largest in the United States. Additionally, Hester was substantially less wealthy than the other team owners; he was the only one among them who was not a millionaire. Cleveland Browns famed coach and owner Paul Brown remarked that Hester seemed out of his element around the other owners, to the point that he was uncomfortable even playing poker among them.
The Seahawks hired Iowa Pre-Flight Seahawks coach Jack Meagher as head coach. Their schedule was quite difficult from the beginning. They played seven of their first eight games on the road. Their first game was a harbinger of things to come--a 44-0 thumping by the Cleveland Browns. By the time of their first home game, they had a record of 0-3-0, leading local papers to describe them as "woefully inept". Meagher quit abruptly on October 22 after winning just one of his first six games. Hamp Pool, captain of the 1940 and 1941 Chicago Bears NFL championship teams, was forced to take over as head coach. After a 1-7-0 start, the team returned home to host their final six games, a difficult sell to the general public. While an average 28,000 people came to the Seahawks' first two home games, fans quickly lost interest in the flagging team, and only around 9,000 came to each of the last three games. Cleveland, and San Francisco had completed their 14-game regular seasons before the Seahawks hosted their final two home games. The team also played all of its November games on Monday night, the first time in major professional football that such a move had ever been attempted more than once in a year.
At the end of the season, the team was $350,000 in debt, including $80,000 in travel and payroll costs, and Hester could not afford to repay it. Football boosters in Miami attempted to buy the team, though they were unwilling to square the substantial debt Hester had accumulated, and decided to wait a year to make the bid. Before this could happen, however, Hester declared bankruptcy and league commissioner Jim Crowley expropriated the team. Before the Miami boosters could make an offer, the league approved a bid by Washington, D.C., attorney Robert D. Rodenburg and four other businessmen. The group reformed the team in Baltimore and relaunched it as the first Baltimore Colts.