Nestor was laid down by the Fairfield Shipbuilding and Engineering Company, Limited, at Govan, Scotland in 1939. She was launched on 9 July 1940 by the daughter of one of the shipyard directors.
Nestor was commissioned in February 1941; although manned by Australians and commissioned as an Australian warship, she remained the property of the Royal Navy.
The destroyer's name came from the mythological wise King of Pylos described in Homer's Odyssey. The ship cost 398,960 pounds to build.
The N-class destroyer had a displacement of 1,773 tons at standard load, and 2,550 tons at full load. Nestor was 356 feet 6 inches (108.66 m) long overall and 229 feet 6 inches (69.95 m) long between perpendiculars, had a beam of 35 feet 8 inches (10.87 m), and a maximum draught of 16 feet 4 inches (4.98 m).
Propulsion was provided by Admiralty 3-drum boilers connected to Parsons geared steam turbines, which provided 40,000 shaft horsepower (30,000 kW) to the ship's two propellers. Nestor was capable of reaching 36 knots (67 km/h; 41 mph).
The ship's company consisted of 249 officers and sailors at the time she was sunk.
The ship's armament consisted of six 4.7-inch QF Mark XII guns in three twin mounts, a single 4-inch QF Mark V gun, a 2-pounder 4-barrel "pom pom", four 0.5-inch machine guns, four 20 mm Oerlikon anti-aircraft guns, four .303 Lewis machine guns, two Pentad torpedo launcher tube sets (with 10 torpedoes carried), two depth-charge throwers and one depth-charge chute (with 45 charges carried). The 4-inch gun was removed later in Nestor's career.
During sea trials, Nestor was called on to make several deployments north of the British Isles, in poor conditions.
On 14 May, the sailors aboard mutinied in response to the heavy drinking sessions of the ship's captain and two other senior officers: they locked themselves in their accommodations and refused to man the ship until the officers were removed. The ship's doctor visited the admiral at Scapa Flow (where the ship was based); the admiral sent marines to arrest the three officers, and appointed a new commander to Nestor.
During May, she was involved in the pursuit of the German battleship Bismarck, but had diverted to Iceland for fuel when the Allied force encountered and sank the German ship.
Nestor was transferred to the Mediterranean in July, and was involved in the Malta Convoys, then performed escort duties in the South Atlantic before returning to England for refit in October. The destroyer returned to service as a Malta Convoy escort in December.
On 15 December, Nestor encountered the German submarine U-127 off Cape St. Vincent; the destroyer successfully hunted down and destroyed the submarine with depth charges.
In January 1942, Nestor was reassigned to the Far East. During the voyage, Nestor and several sister ships escorted the aircraft carrier HMS Indomitable during attempts to deliver aircraft to Malaya. After this, Nestor joined the British Eastern Fleet, and was based at Colombo.
In March 1942, the town of Andover, Hampshire adopted Nestor after they raised £214,467 during a Warship Week.
In May 1942, the destroyer was assigned back to the Mediterranean.
According to one source, at around 18:00, while off Crete, an Italian bomber attacked Nestor, killing four sailors and seriously damaging the destroyer's engine rooms. Other sources assert the attack was carried out by Junkers Ju 87 dive bombers from Sturzkampfgeschwader 3.
HMS Javelin began to tow Nestor, but by 05:30 on 16 June, the quantity of water taken on by the Australian ship meant that recovery was no longer practical. The ship's company transferred to Javelin, and Nestor was scuttled with depth charges.
Nestor was the only major RAN ship to never visit Australia.
Nestor's wartime service was recognised with four battle honours: "Bismarck 1941", "Atlantic 1941", "Malta Convoys 1941–42", and "Indian Ocean 1942".
The ship's bell was recovered, and is on display at the museum at HMAS Cerberus.