There were several stages of refits planned for Hood in the late 1930s. These varied from relatively minor refits to a major reconstruction. The refit planned for 1941-42 might well have been a major reconstruction, akin to those performed on several of the Queen Elizabeth-class battleships or the battlecruiser Renown, but could have been a more minor refit.

In the 1930s, the Royal Navy was well aware that Hood was, without modernisation, rapidly becoming obsolete. In 1935, a small program of refits was authorised, to take place in 1935-6. This was to add aircraft handling facilities in the form of a turret-mounted catapult and a crane for recovering seaplanes. There was also to be a modernisation of her AA outfit. Four of her single 4in AA guns were to be replaced with the new dual mountings, and new directors and more light AA were to be fitted. However, none of these changes were made. The outbreak of the Spanish Civil War meant that she could not be spared from the Mediterranean Fleet for long enough to undergo the planned refit in Portsmouth. Instead, in 1938, she underwent a more minor refit in Malta. In this refit, two of her 5.5in secondary guns were replaced with single 4in guns. Her underwater torpedo tubes were removed, reducing the risk of flooding by eliminating the large compartments these fitted into. An octuple 40mm pom-pom light AA mounting was fitted aft, on the site of the now-unnecessary after torpedo control tower. This brought her total number of such mountings up to three. While the crane and catapult had been sent to Malta, they were not fitted at this refit.

Her next refit took place shortly before the start of WWII at Portsmouth in February-August 1939. Her forward 5.5in guns were removed, along with the single 4in guns. These were replaced with four twin 4in AA mounts. New AA directors and control systems were fitted. Four more searchlights were added, and they were given power controls that allowed them to be remotely operated. She was given a high-frequency direction finder (HF/DF), for locating radio signals, and her watertight integrity aft was improved. Once again, the catapult and crane were not fitted. After the start of the war, she received another refit at Devonport, in March-June 1940. Her remaining 5.5in guns were removed, and three more twin 4in mounts added. To bolster her AA armament, five mountings for the 'Unrotated Projectile' AA rocket system were added. Preparations were made for the fitting of a modern fire control system for her main armament. Finally, she received additional splinter protection to protect crew in exposed positions, such as at the AA guns or on the bridge. Her final refit came in January-March 1941. Here, radar was added and the HF/DF system removed. During these refits, minor maintenance tasks were also carried out; these included things like retubing her boilers and condensers or scraping and repainting the hull.

All of these refits had had major effects on Hood. She had never been the driest ship, but the refits had added another ~3000 tons over her design weights. This reduced her metacentric height (a measure of a ship's stability) by 1.5 ft and brought her down by the bow. As a result, she became a very wet ship, with reports of flooding in her living spaces in bad weather. To solve this, the Director of Naval Construction proposed removing the armour from her conning tower. This would remove about 375 tons of weight, but weight which was positioned high in the ship. In turn, this might allow for more additions to be made. The RN still wanted Hood to have a catapult, and she was yet to receive the modern fire control tower that had been fitted to other ships, despite the preparations made in 1940. A minor refit along these lines might also have added still more splinter protection and incremental improvements to her AA armament, with the UP mountings being replaced with more effective weapons.

There was another possibility, that of a full reconstruction. This was first mooted in March 1937, with a committee held in July of that year to choose from the options drawn up. This decided on a refit that greatly resembled those planned for Queen Elizabeth, Valiant and Renown. Under this plan, she would receive a major rebuild above the upper deck, with a new secondary armament of ten twin 4.5in guns, four octuple pom-poms and several quadruple 0.5in machine guns. She would be given a new superstructure, hangars and a cross-deck catapult. She would not receive new engines, but might receive new boilers. Armour improvements were mooted, but no decisions were made at this point. However, there were worries, especially over timing. Work on reconstruction could not start until the first two King George V class were available, delaying the start until 1940 at the earliest. Any reconstruction would take at least 18 months, and as Hood was not expected to last much longer than 1950, the reconstruction might end up being a waste of money. Two more minor schemes were proposed. One would limit improvements solely to those above the upper deck, while the other would also include reboilering the ship and some improvements to her deck armour.

In 1939, though, a decision was made to go forward with a full reconstruction. The plan started with a complete replacement of her machinery. The new plan would follow the layout of the KGV class, with boiler and engine rooms alternating to remove risks from direct hits. This would free up space for a new secondary armament, of sixteen 5.25in guns in eight twin turrets. If new machinery was not added, then the secondary battery would drop to either twelve 5.25in or sixteen 4.5in. Six octuple pom-poms were to be added, but her remaining above-water torpedo tubes were to be removed. She would receive the planned cross-deck catapult, hangars and new superstructure. Three schemes were drawn up for her armour protection. In all of them, the thin 5in uppermost belt was to be removed, and splinter protection on the lower deck extended. The simplest scheme was nothing more than this. The next scheme saw the existing 12in and 7in belts kept, with deck protection improved to 5in over her magazines and 4in over her machinery. The most extensive scheme would have seen the 12in belt extended to her upper deck, with the upper deck being increased to 2.5in over her machinery and 4in over the magazines. Later in 1939, the decision was made to go ahead with the reconstruction, with the most extensive armour scheme and new machinery being fitted. However, this refit could not take place before the end of 1941, to ensure that there were enough ships to cover for her prolonged absence.

It's not entirely clear what decision would have been made had Hood survived the Battle of the Denmark Strait. She was certainly in dire need of a refit. Her boilers were knackered and there were incipient problems with her turbines that needed addressing. Neither were expected to be able to last long beyond 1942. She also needed her topweight addressing, as well as improvements to her AA outfit and protection to keep her competitive when compared to more modern ships. However, a full reconstruction may not have been entirely practical. It would put her out of action for up to three years, at a time when the RN direly needed fast capital ships. As such, something simpler may have been more desirable.