Eight Recce was formed at Guillemont Barracks, near Aldershot in southern England, on March 11, 1941, by merging three existing squadrons within the division. Its first commanding officer was Lieutenant Colonel Churchill C. Mann. Mann was succeeded as commanding officer on September 26, 1941, by Lieutenant Colonel P. A. Vokes, who was in turn followed on February 18, 1944, by Lieutenant Colonel M. A. Alway. The last commanding officer was Major "Butch" J. F. Merner, appointed to replace Alway a couple of months before the end of the fighting in Europe.

8 Recce had its roots in the 14th Canadian Light Horse, a militia unit formed in 1920. One source claims the unit was the union of the 27th Light Horse and the 14th Canadian Mounted Rifles, but the official lineage shows no amalgamation in 1920, just a renaming of the 27th Light Horse. Authoritative lists of units in the Active Militia and the Canadian Expeditionary Force show no record of a "14th Canadian Mounted Rifles" – there were only 13 regiments of mounted rifles organized in the CEF. In any event, the 14th Canadian Light Horse in the 1920s was headquartered in Swift Current, Saskatchewan. It comprised 'A', 'B' and 'C' Squadrons based at Swift Current, Swift Current and Shuanavon, respectively. In 1937 the regiment was designated a mechanized unit, and in 1940 the regiment was renamed the 14th Canadian Hussars. In 1941 an Active Service regiment was mobilized, and its members joined with other reconnaissance personnel in England to form 8 Recce.