The National Army was constituted from the revolutionary Irish Republican Army (IRA), which emerged from the successful Irish War of Independence fought as a guerrilla campaign against the British Army and Royal Irish Constabulary. On 31 January 1922 the first unit of the new National Army, a former IRA unit of the Dublin Guard, took possession of Beggars Bush Barracks, the first British barracks to be handed to the new State. Michael Collins envisaged the new army being built around the pre-existing IRA, but over half of this organisation rejected the compromises made in the Anglo-Irish Treaty, and favoured upholding the revolutionary Irish Republic that had existed from 1919 until 1921.

In February 1922, the new Provisional Government began to recruit volunteers into the National Army. A force of 4,000 troops was envisaged, but with the impending Civil War, on 5 July 1922 the Provisional Government authorised raising an establishment of 35,000 men; by May 1923 this had grown to 58,000 troops. The National Army lacked the expertise necessary to train a force of that size, so approximately 20 percent of its officers and 50 percent of its soldiers were Irish ex-servicemen of the British Army and men like Martin Doyle, Emmet Dalton, W. R. E. Murphy, and Henry Kelly brought considerable combat experience.