IAF Chief BS Dhanoa resurrected the 17 squadrons at an event on Tuesday at the Ambala Air Force Station.
The ‘Golden Arrows’ 17 Squadron was commanded by Air Chief Marshal Dhanoa during the Kargil war in 1999.
The squadron, which operated from Bhatinda airbase, was disbanded in 2016 after the IAF started gradual phasing out of Russian-origin Mig 21 jets.
The squadron was formed in 1951, and initially, it flew de Havilland Vampire F Mk 52 fighters.
India is expected to receive the first Rafale jet by the end of this month.
The IAF has already completed preparations, including readying required infrastructure and training of pilots, to welcome the fighter aircraft.
India had inked an inter-governmental agreement with France in September 2016 for procurement of 36 Rafale fighter jets at a cost of around Rs 58,000 crore.
A number of IAF teams have already visited France to help Dassault Aviation, the manufacturer of Rafale, incorporate India-specific enhancements on-board the fighter aircraft
The Rafale jets will come with various India-specific modifications, including Israeli helmet-mounted displays, radar warning receivers, low band jammers, 10-hour flight data recording, infra-red search and tracking systems among others.
The IAF spent around Rs 400 crore to develop required infrastructure like shelters, hangers and maintenance facilities at the two bases.
In July 2017, Air Chief Marshal BS Dhanoa, during his visit to France, flew a Rafale jet at the Saint-Dizier airbase to gain first-hand experience of the aircraft.
According to the deal, the delivery of the jets was to be completed in 67 months from the date the contract was inked.