The technique was developed by General Electric's Light Military Electronics Department, Utica, New York.
In order to mount the chip to external circuitry (e.g., a circuit board or another chip or wafer), it is flipped over so that its top side faces down, and aligned so that its pads align with matching pads on the external circuit, and then the solder is reflowed to complete the interconnect.
The individual chips are patterned with small pads of metal near their edges that serve as the connections to an eventual mechanical carrier.
These wires eventually lead to pins on the outside of the carriers, which are attached to the rest of the circuitry making up the electronic system.
The underfill distributes the thermal expansion mismatch between the chip and the board, preventing stress concentration in the solder joints which would lead to premature failure.
Also with TAB it is possible to connect die pins all at the same time as with the soldering based flip chip mounting.
The short wires greatly reduce inductance, allowing higher-speed signals, and also conduct heat better.
They also require very flat mounting surfaces, which is not always easy to arrange, or sometimes difficult to maintain as the boards heat and cool.
The process was originally introduced commercially by IBM in the 1960s for individual transistors and diodes packaged for use in their mainframe systems.
Flip chips have recently gained popularity among manufacturers of cell phones and other small electronics where the size savings are valuable.