Although CP/M had dominated the market since the mid-1970s, and was shipped with the vast majority of non-proprietary-architecture personal computers, the IBM PC in 1981 brought the beginning of what was eventually to be a massive change.

The proportion of PC buyers prepared to spend six times as much to buy CP/M-86 was very small, and the limited availability of compatible application software, at first in Digital Research's favor, was only temporary.

Although DRI was based in Pacific Grove and later in Monterey, California, USA, the work on DOS Plus started in Newbury, Berkshire in the UK, where Digital Research Europe had its OEM Support Group located since 1983.

As requested by several OEMs, Digital Research started a plan to develop a new DOS operating system addressing the defects left by MS-DOS in 1987.

[12] Of particular importance was a million dollar deal with Kazuhiko "Kay" Nishi of ASCII Corporation, who had previously been instrumental in opening the Japanese OEM market for Microsoft.

Consequently, DR DOS achieved some immediate success when it became possible for consumers to buy it through normal retail channels beginning with version 3.4x.

[19][20][21] DR DOS 5.0 also introduced the patented BatteryMAX power management system, bundled disk-caching software (DRCACHE), a remote file transfer tool (FILELINK), a cursor shape configuration utility (CURSOR), and offered a vastly improved memory management system (MemoryMAX).

[17][18] For compatibility purposes, the DR DOS 5.0 system files were now named IBMBIO.COM (for the DOS-BIOS) and IBMDOS.COM (for the BDOS kernel) and due to the advanced loader in the boot sector could be physically stored anywhere on disk.

This freed up the equivalent amount of critical "base" or conventional memory, the first 640 KB of the PC's RAM – the area in which all DOS applications run.

Once drivers for a mouse, multimedia hardware and a network stack were loaded, an MS-DOS/PC DOS machine typically might only have had 300 to 400 KB of free conventional memory – too little to run much late-1980s software.

[36] PalmDOS was the first operating system in the family to support the new BDOS 7.0 kernel with native DOS compatible internal data structures instead of emulations thereof.

[12] Marc Perkel claimed to have had inspired Novell in February 1991 to buy Digital Research and develop something he envisioned as "NovOS".

[49] Novell had actually bought Digital Research in July 1991 with a view to using DR's product line as a lever in their comprehensive strategy to break the Microsoft monopoly.

(This was part of a massive and ultimately disastrous spending spree for Novell: they bought WordPerfect Corporation at about the same time, some of Borland's products, and invested heavily in Unix as well.)

The planned "DR DOS 7.0", internally named "Panther", intended to trump Microsoft's troubled MS-DOS 6.0, was repeatedly delayed, while Novell was working on an optionally loadable Unix-like multi-user security extension (with, if loaded, file commands like BACKUP, DELPURGE, MOVE, TOUCH, TREE, UNDELETE, XATTRIB, XCOPY, XDEL and XDIR supporting an otherwise disabled /U:name command line option to select specific users or groups,[38] compatible with Multiuser DOS) and two new graphical user interfaces (ViewMAX 3, a derivative of GEM, and "Star Trek", a true port of Apple's System 7.1 to run under the new DR DOS multitasker named "Vladivar").

[52][53][51] The campaign aimed at 20% of the DOS market and resulted in about 1.5 million copies sold until February 1994 and more than 3000 dealers interested to carry the product.

Claimed by them to be a purely technical change, this was later to be the subject of a major lawsuit brought in Salt Lake City by Caldera with the help of the Canopy Group.

Immediately after the completion of the pre-trial deposition stage (where the parties list the evidence they intend to present), there was an out-of-court settlement on 7 January 2000 for an undisclosed sum.

[nb 2] Besides other improvements and enhancements all over the system, a string of new key features were added subsequently over the course of the next two years, including a TCP/IP stack (derived from LAN WorkPlace for DOS / NetWare Mobile), a graphical 32-bit DOS Protected Mode HTML 3.2 web-browser DR-WebSpyder (originally based on source code from the Arachne web browser by Michal Polák) with LAN and modem dialup, a POSIX Pthreads extension to the multi-tasker by Andy T. Wightman, long filename (LONGNAME) support by Edward N. Hill Jr., as well as LBA and FAT32 support (DRFAT32) by Matthias R. Paul.

[62][63][64] This was demonstrated at CeBIT in March 1998,[62][63] and later, in a small team, developed into "WinBolt", both versions of DR-DOS, which remained unreleased as of 2023[update], but played an important role in the court case.

[70] It also allowed to change the SCROLLOCK, CAPSLOCK, INSERT and VERIFY settings as well as the SWITCHAR, YESCHAR, NOCHAR and RESUMECHAR characters.

[70][76] At a reduced memory footprint version 7.02 also brought an enhanced NLS 4.xx sub-system by Paul to allow multiple, distributed and possibly user-configured COUNTRY.SYS files to be used by the system at the same time in a hierarchical model.

[87] Another version, DR-DOS 7.03 (still with BDOS 7.3 and reporting itself to applications as "PC DOS 6.0" for compatibility purposes), was pre-released at Christmas 1998 and then officially released on 6 January 1999 by Caldera UK.

Caldera, Inc. wanted to relocate the DR-DOS business into the US and closed the highly successful UK operation[90][91] in February 1999[92] after Gross resigned and set up iCentrix to develop the MarioNet split web browser.

DR-DOS 8.0 was released on 30 March 2004 featuring FAT32 and large disk support, the ability to boot from ROM or Flash, multitasking and a DPMI memory manager.

The OpenDOS 7.01 source code was a base for The DR-DOS/OpenDOS Enhancement Project, set up in July 2002 in an attempt to bring the functionality of DR-DOS up to parity with modern PC non-Windows operating systems.

[102] From 2023 on the last Enhanced DR-DOS release 7.01.08 WIP was ported to an open source build tool chain, which makes the kernel and command interpreter cross-buildable from operating systems other than DOS.

DR DOS, Inc. failed to comply with the GNU General Public License (GPL) by not crediting the FreeDOS utilities to their authors and including the source code.

[100] After complaints from FreeDOS developers (including the suggestion to provide the source code, and hence comply with the GPL), DR DOS, Inc. instead withdrew version 8.1, and also the unaffected 8.0, from its website.

APPEND, ASSIGN, BATCH, DBG, DELQ, ERA, ERAQ, MORE and SUBST have been among the internal commands supported since DR DOS 3.31.