With special software it's possible to read C1581 disks on an x86 PC system, and likewise, read MS-DOS and other formats of disks in the C1581 (using Big Blue Reader), provided that the PC or other floppy handles the "720 kB" size format.

The drive was released in the summer of 1987 and quickly became popular with bulletin board system (BBS) operators and other users.

Like the 1541 and 1571, the 1581 has an onboard MOS Technology 6502 CPU with its own ROM and RAM, and uses a serial version of the IEEE-488 interface.

The version of Commodore DOS built into the 1581 added support for partitions, which could also function as fixed-allocation subdirectories.

With a storage capacity of 800 kB, the 1581 is the highest-capacity serial-bus drive that was ever made by Commodore (the 1-MB SFD-1001 uses the parallel IEEE-488), and the only 3½" one.