[1] Unlike the rest of the S/360 series, it included features to facilitate time-sharing applications, notably a Dynamic Address Translation unit, the "DAT box", to support virtual memory, 32-bit addressing and the 2846 Channel Controller to allow sharing channels between processors.

[4] At that time the work that computers could perform was limited by their lack of real memory storage capacity.

A paper titled Program and Addressing Structure in a Time-Sharing Environment by Bruce Arden, Bernard Galler, Frank Westervelt (all associate directors at the University of Michigan's academic Computing Center), and Tom O'Brian building upon some basic ideas developed at the Massachusetts Institute of Technology (MIT) was published in January 1966.

[5] The paper outlined a virtual memory architecture using dynamic address translation (DAT) that could be used to implement time-sharing.

After a year of negotiations and design studies, IBM agreed to make a one-of-a-kind version of its S/360-65 mainframe computer for the University of Michigan.

As other organizations heard about the project they were intrigued by the time-sharing idea and expressed interest in ordering the modified IBM S/360 series machines.

With this demonstrated interest IBM changed the computer's model number to S/360-67 and made it a supported product.

DAT on the 360/67 was based on the architecture outlined in a 1966 JACM paper by Arden, Galler, Westervelt, and O'Brien[5] and included both segment and page tables.

Note that while Carnegie Tech had a 360/67 with an IBM 2361 LCS, that option was not listed in the price book and may not have worked in a duplex configuration.

The unique features of the S/360-67 were initially not carried into IBM's next product series, the System/370, although the 370/145 had an associative memory that appeared more useful for paging than for its ostensible purpose.

[13] This was largely fallout from a bitter and highly visible political battle within IBM over the merits of time-sharing versus batch processing.

In 2010, in the technical description of its latest mainframe, the z196, IBM stated that its software virtualization started with the System/360 model 67.