However, Aérospatiale did not give up on the design, subsequently developing a twin-engine derivative of the SA 360, the Dauphin 2, which proved to be commercially successful, having been in production for in excess of 40 years.

[1] Towards the end of that decade, the company recognised that there was a vacant niche between the smaller Gazelle and the larger Puma for which a new helicopter could be developed to fulfil.

[3][4] It was initially powered by a single Turbomeca Astazou XVI turboshaft engine, capable of generating up to 730 kW (980 hp) of thrust.

The original design of the Dauphin drew heavily upon several of Aérospatiale's other rotorcraft, having adopted the fenestron anti-torque device of the Gazelle and the main rotor system of the Alouette III.

Additionally, the original metal rotor blades were replaced with plastic counterparts, Aérospatiale engineers had made this change for the purpose of reducing both vibration levels and instances of ground resonance.

A helicopter of this size that was powered by only a single engine was perceived in the marketplace as something of an anomaly and rather under-powered, meaning that by the end of 1976, Aérospatiale was left with 15 airframes – almost half those produced to date – with no buyers.

The major differences from its former configuration were the installation of an even more powerful Astazou XXB engine, capable of providing up to 1,040 kW (1,400 hp), along with the adoption of the Starflex rotorhead which had been originally developed for the Aérospatiale AS350 Écureuil helicopter.

[12][13] While the fenestron had been first introduced a few years earlier upon another of Aérospatiale's rotorcraft, the Gazelle, the Dauphin's implementation featured considerable refinement over the earlier arrangement; the direction of rotation was reversed so that the blade on the bottom was the advancing blade, the original direction having proved unfavourable when encountering the downwash of the main rotor during early testing of the Dauphin.

Testing demonstrated the fenestron to have clear performance advantages over the conventional tail rotor, leading to it being applied to numerous other rotorcraft following the Dauphin as well.