The development of German torpedo boats of World War II was centered around the classic concept of using those kind of ships similar to World War I. The key idea was to execute torpedo attacks on other, bigger surface vessels as it was done during the Battle of Jutland in 1916.
While the first new torpedo boats build after World War I were basically small destroyers with an adequate mix of artillery and torpedo armament, those designs build in the mid 1930s were totally focused on torpedo attacks. When it got obvious that those kind of attacks were not possible anymore during World War II, those ships proved to be almost useless for other operations. Therefore the last Fleet torpedo boat designs returned to a ship equal to a small destroyer.
The Torpedo boats were used in several different ways, for escort duty, mine laying, surface patrols or U-boat training, of the 51 ships build, only 12 survived the war. Some of them were handed over to allied navies and used until the mid 1950s.