The car was manufactured in Estonia's Arsenal factory, while the engine was provided by the British company Crossley Motors Ltd and the armored plates were ordered from Sweden.

The plans for the Arsenal Crossley light armored car were developed in the Estonian War Ministry between 1924 and 1925.

In 1930 the unit was named "Tallinna maleva üksik soomusautorühm" (single armored car platoon of the Malev of Tallinn) and it remained a part of the Defence League until 1940.

During a Defense Council meeting in 1935, Estonian Defence Forces chief of staff Major-General Nikolai Reek stated that the newly bought TKS tankettes and Arsenal Crossley cars were the only combat capable armored vehicles Estonia possessed (Estonia also had the French Renault FT and British Mark V tanks and some War of Independence-era armored cars).

The crew would also be issued with a Suomi submachine gun and a personal revolver, but this idea was later dropped due to a lack of funds and it was subsequently planned to only re-arm the cars.

[3] After the Soviets occupied the country, the Estonian Defence Force was dissolved and most of the Arsenal Crossleys were given to the newly formed 22nd Territorial Rifle Corps.