The Gnatsnapper was a submission to Air Ministry specification N.21/26 for a carrier fighter, which called for an aircraft powered by a Bristol Mercury II engine, capable of at least 160 mph at 10,000 ft.

In 1930, a new carrier fighter competition (N16/30) was announced by the Air Ministry, for which Gloster was requested to redesign the Gnatsnapper to use the 540 hp Armstrong Siddeley Jaguar VIII.

Designated the Gnatsnapper II, the aircraft was submitted for evaluation but was badly damaged in a landing accident before the trials had been completed, eliminating it from the competition, which was eventually won by the Hawker Nimrod.

After repair, the aircraft was substantially modified to accept a 525 hp Rolls-Royce Kestrel IIS evaporatively-cooled engine, with the condensers in the leading edges of the wings, this version being designated the Gnatsnapper III.

Although an attempt to make this aircraft meet the requirements of N.16/30 was made, the obvious superiority of the Nimrod caused Gloster to stop development work on the type.