In the two-year period of the rules being framed,the PEI functioned under the regulations of  O Corpo de Policia e Fiscalizacao da India (CPFI) – The Corps of Police and Inspection Services of India that had been set up in 1924 to function as the policing arm of the military. The police services had been placed under the direct supervision of the CPFI command.
             

The PEI was organized into five territorial divisions for efficient performance with each division headed by a commissioner who reported to the commander of the PEI. The PEI thus developed into a supreme law and order establishment, with even officials and agents of organizations such as Customs having to inform it about violations that came to their notice. Not only did the PEI have powers to conduct search and seizure operations, it could also frame proceedings for prosecution and file cases for extraditing criminals.

 Punishment and rewards were used to enhance efficiency of the police force. Punishment included verbal admonishment, censure, fines, detention upto 130 days and imprisonment for upto 30 days, reversion, compulsory retirement and dismissal. If the punishment was stiff, the rewards were generous: exemption from service upto 12 days, leave with salary upto 30 days and pecuniary benefits upto 30 days' pay.

The strength of the PEI continued to grow year after year, keeping in mind the rising need of  maintaining law and order in a enlarging society. But the main reason for the growth in strength was the Portuguese regime's need to contain the increasing surge of freedom movement in Goa. Much of the PEI's time would be consumed in trying to contain agitations and other forms of freedom movement, that received a boost by Dr Ram Manohar Lohia's civil disobedience movement launched in 1946 – the very same year of PEI's establishment. In time to come, the PEI, which had gained respect for efficient policing of the territory, began to court notoriety for its brutal repression of the freedom movement.

With Liberation and the departure of the Portuguese, began a long and exhaustive overhaul of the

Goa Police. Work to reorganize the police department on the lines of what existed in the rest of the country, began in right earnest. N R Nagu took over as the first Inspector General of Police (IGP) of free Goa and a host of other appointments were made just a day after liberation. Services of those officials serving the PEI were protected and   they were suitably accommodated in Goa Police. Those who wished to be relieved were allowed to do so with effect from February 1, 1962. However, the ranks and organizational structure of the   PEI was retained for a longer period before being transformed in keeping with what existed in the  country. Officers taken on deputation had meanwhile begun to introduce policing systems based on Indian laws and procedures.