Apart from the use of the Siemens-Halske Sh.I, a geared rotary engine in which the crankshaft and the propeller rotated in opposite directions, the D.I was in fact a fairly close copy of the Nieuport.

These featured a short, round section fuselage designed to fit a larger engine, leading to a rather stubby-looking aircraft which pilots later referred to as the flying beer barrel.

Flight tests started in June 1917, and while the aircraft did not have a very high top speed, they showed outstanding rates of climb.

After completion in October 1917, the design proved promising and in December an order for twenty long-span D.IIc's was placed with a smaller 4-bladed propeller that allowed for shorter landing gear legs.

All fifty were delivered to front-line units in May, where they proved popular but after only 10 hours of service the engines started showing serious problems, overheating and seizing.

[citation needed] A version of the Sh.III passed a 40-hour endurance test in June and the aircraft were cleared to return to service in July.

Another thirty new aircraft with these features were built and all eighty of the improved design entered service in home defense units where their climb rate made them excellent interceptors.