Introduced in the early 1960s in Army and Marine Corps service, the M67 was used in the Vietnam War together with the much larger 106mm M40. The M67 proved a reliable and effective weapon, though it was primarily used against personnel and fortifications in combat, and saw little or no use against armor. While troops praised its effectiveness, the M67 came in for heavy criticism due to the weapon's weight and length as well as its backblast, which often precluded its use in offensive operations. Because of these disadvantages, some Marine Corps units continued to use the old M20 rocket launcher (Super Bazooka) in preference to the M67. It was largely replaced in Army service by the TOW missile system in 1970 and the M47 Dragon anti-tank missile system in 1975.
The M67 was not completely withdrawn from infantry service. Instead, it was retained as a substitute standard antitank weapon for special tasks or battle environments. Since the batteries of the Dragon and the wires of the TOW could fail due to extremely low temperatures, the M67 was used for units deploying to arctic environments and remained in many infantry units in West Germany, such as the 1st Battalion, 15th Infantry, 3rd Infantry Division. As of 1988, the 6th Light Infantry Division in Alaska was still using the M67 in its special weapons platoons. Two M67s were used by C Co 5/87th (Lt Infantry) 193rd Infantry Brigade during Operation "Just Cause" in the Republic of Panama in 1989, using the M590 Antipersonal Ammunition. Similarly, the urban environment of West Berlin prompted the Army to keep the weapon with the 4th, 5th and 6th Battalions of the 502nd Infantry Regiment, Berlin Brigade, as late as winter of 1991; the M47 Dragon replaced it in January 1992. The Army Rangers retained the M67 in their weapons platoons until in the 1990s the 84mm M3 Carl Gustav replaced it. Lastly, Combat Engineer units used the M67 as a demolition gun to destroy bunkers and other hard point targets. Combat Engineer units had the M67 as part of their MTOE (Modified Table Of Organization & Equipment) at least as late as 1990.
In February 2011, it was reported that stocks of surplus M67 recoilless rifles were reintroduced to the 101st Airborne Division for limited combat service in Afghanistan. Numbers of these weapons were issued to the 506th Infantry Regiment, "Currahee", 4th Brigade Combat Team, for use against fortifications, and concentrations of enemy personnel. The M67 was issued in response to a demand for a reloadable shoulder-fired weapon to be used in static defensive positions as well as ambushes. In particular, the flechette antipersonnel round is seeing common usage.