The Battle of Gang Toi (8 November 1965) was fought during the Vietnam War between Australian troops and the Viet Cong. The battle was one of the first engagements between the two forces during the war and occurred when A Company, 1st Battalion, Royal Australian Regiment (1 RAR) struck a Viet Cong bunker system defended by Company 238 in the Gang Toi Hills, in northern Biên Hòa Province. It occurred during a major joint US-Australian operation codenamed Operation Hump, involving the US 173rd Airborne Brigade, to which 1 RAR was attached. During the latter part of the operation an Australian rifle company clashed with an entrenched company-sized Viet Cong force in well-prepared defensive positions. Meanwhile, an American paratroop battalion was also heavily engaged in fighting on the other side of the Đồng Nai River.

The Australians were unable to concentrate sufficient combat power to launch an assault on the position and consequently they were forced to withdraw after a fierce engagement during which both sides suffered casualties, reluctantly leaving behind two men who had been shot and could not be recovered due to heavy machine-gun and rifle fire. Although they were most likely dead, a battalion-attack to recover the missing soldiers was planned by the Australians for the next day, but this was cancelled by the American brigade commander due to rising casualties and the need to utilise all available helicopters for casualty evacuation. The bodies of the two missing Australian soldiers were subsequently recovered more than 40 years later, and were returned to Australia for burial.

Although the initial American commitment to the war in Vietnam had been limited to advice and materiel support, by 1964 there were 21,000 US advisors in South Vietnam. However, with the Army of the Republic of Vietnam (ARVN) weakened by successive defeats at the hands of the communists, the South Vietnamese government faltering, and Saigon threatened with a major offensive, the situation led to a significant escalation of the war in 1965, with a large-scale commitment of US ground troops under the command of General William Westmoreland. At first the Americans had adopted a cautious strategy, applied to the strictly limited role of base defence by US Marine units. This was abandoned in April 1965, and replaced by a new "enclave strategy" of defending key coastal population centres and installations. This strategy required the introduction of nine additional US battalions, or 14,000 troops, to bring the total in Vietnam to 13. Allied nations of the Free World Military Assistance Forces were expected to contribute another four battalions.

Westmoreland planned to develop a series of defensive positions around Saigon before expanding operations to pacify the South Vietnamese countryside and as a result a number of sites close to Viet Cong dominated areas were subsequently chosen to be developed into semi-permanent divisional-level bases. Such areas included Dĩ An which was intended to become the headquarters of the US 1st Infantry Division, while the US 25th Infantry Division would be based in the vicinity of Củ Chi. However, large-scale military operations to clear the intended base areas had to wait until the dry season. Yet the allied enclave strategy proved only transitory and further setbacks led to additional troop increases to halt the losing trend. With the situation reaching a crisis point during the Viet Cong wet season offensive in June 1965, Westmoreland requested further reinforcement and US and allied forces increased to 44 battalions which would be used to directly bolster the ARVN.

Australia's growing involvement in Vietnam reflected the American build-up. In 1963, the Australian government had committed a small advisory team, known as the Australian Army Training Team Vietnam (AATTV), to help train the South Vietnamese forces. However, in June 1965 the decision to commit ground troops was made, and the 1st Battalion, Royal Australian Regiment—originally commanded by Lieutenant Colonel Ivan 'Lou' Brumfield—was dispatched. Supporting 1 RAR was the 1 Troop, A Squadron, 4th/19th Prince of Wales's Light Horse equipped with M113 armored personnel carriers, artillery from the 105th Field Battery, Royal Australian Artillery and 161st Battery, Royal New Zealand Artillery, and 161st Reconnaissance Flight operating Cessna 180s and Bell H-13 Sioux light observation helicopters; in total 1,400 personnel. The Australian units and New Zealand artillery were attached to the US 173rd Airborne Brigade under the command of Brigadier General Ellis W. Williamson in Biên Hòa and operated throughout the III Corps Tactical Zone (III CTZ) to help establish the Biên Hòa–Vũng Tàu enclave. Although logistics and resupply were primarily provided by the Americans, a small logistic unit—1st Australian Logistics Company—was situated at Bien Hoa airbase. Unlike later Australian units that served in Vietnam, which included conscripts, 1 RAR was manned by regular personnel only.

Attached to US forces, 1 RAR was primarily employed in search and destroy operations using the newly developed doctrine of airmobile operations, utilising helicopters to insert light infantry and artillery into an area of operations, and to support them with aerial mobility, fire support, casualty evacuation, and resupply. The battalion commenced operations in late June 1965 and initially focussed on defeating the Viet Cong's wet season offensive. During this time US 173rd Brigade, including 1 RAR, conducted a number of operations into War Zone D—a major communist base area at the junction of Phước Long, Long Khánh, Biên Hòa and Bình Dương provinces—as well as in the Iron Triangle in November.

By late 1965 the junction of the Bé and Đồng Nai rivers had become a major communist staging area for men, equipment, and supplies for units based around Saigon and the Mekong Delta. Communist communications and resupply routes between War Zone C and D also met in this area. Westmoreland planned to use the US 173rd Airborne Brigade to keep the Viet Cong off balance and to target their base areas, and consequently a search-and-destroy operation codenamed "Operation Hump" was planned. Operation Hump marked the half-way point in the twelve-month tour of duty of the 173rd Airborne Brigade and was named accordingly. The concept of operations envisioned 1 RAR and the US 1st Battalion, 503rd Infantry Regiment being inserted by helicopter during an airmobile operation into War Zone D, in an area about 20 kilometres (12 mi) north-east of the Bien Hoa Air Base. The Australian and American area of operations (AO) was to be separated by the Đồng Nai River, with 1 RAR to deploy into a landing zone (LZ) to the south, while the 1/503rd would conduct a helicopter assault onto a LZ northwest of the Đồng Nai and Bé rivers. Meanwhile, the 173rd Airborne Brigade's second battalion—2nd Battalion, 503rd Infantry Regiment—would be left to defend Bien Hoa Air Base.

The area was thought to be a Viet Cong stronghold and American intelligence initially identified Q762 Main Force Regiment and D800 Main Force Battalion as being nearby. However, unknown to the allied force, the Viet Cong 9th Division had likely received forewarning of the operation and had deployed one of its most experienced regiments, supported by a number of local force battalions, determined for a test of allied strength. The 271 Main Force Regiment (also known as Q761 Main Force Regiment) subsequently took up defensive positions in the area, while the communist U1 headquarters protected by Company 238, was situated on the plateau atop the Gang Toi Hills in an area which formed part of 1 RAR's objective. U1 was responsible for co-ordinating the Viet Cong regional defence against the Bien Hoa air base and for developing anti-government resistance and had been tasked with rebuilding the covert organisation in Biên Hòa city and the surrounding villages up to the Đồng Nai, as well as re-establishing the link between Biên Hòa city and War Zone D, and for planning and executing attacks against the air base itself. Yet having relocated to the rainforest two months earlier, its presence was also unknown to the Australians and Americans. Regardless, A Company 1 RAR was scheduled to conduct a search of the plateau on the fourth day of the operation.