After studying the market it decided that its next product would be a highly competitive small airliner instead, filling a niche it identified for a 12–18 seat high-speed design.

Considerable attention was paid to streamlining in order to improve performance, which led to one of the design's more distinctive features, a long nose profile.

Final assembly took place in a new factory at the Radlett aerodrome, but large portions of the structure were subcontracted, including complete wings being built by Scottish Aviation at Prestwick, Scotland and the tail section by Northwest Industries of Edmonton, Alberta, Canada.

The original design used Turbomeca Astazou XVI engines of approximately 840 hp (626 kW), and flew on 18 August 1967 as the Jetstream 1.

Testing was eventually moved to the Turboméca factory airfield in the south of France, both to allow faster turnaround with engine work, and in order to improve the schedule by taking advantage of the better weather.

However, by this point Handley Page had given up on the original engine, and the Jetstream 2 was launched with the larger 965 hp (720 kW) Astazou XVI, starting deliveries in late 1969.

A Jetstream operated by Apollo Airways, a commuter airline based at the Santa Barbara Airport in California, appeared in the 1979 film "Moonraker" starring Roger Moore where British secret agent James Bond (007) is thrown out of the aircraft while it is in flight.