In March 1941,[1] the U. S. Navy awarded McDonnell Aircraft a contract for a radio-controlled target drone under the designation of XTD2D-1 for anti-aircraft and aerial gunnery practice.

The aircraft had a mid-mounted wing, V-tail, and McDonnell XPJ40-MD-2 pulsejet engine mounted atop the rear fuselage.

The drone could be either launched by catapult from the ground or from underwing racks on Consolidated PBY Catalina flying boats.

Later that year, the Navy changed McDonnell's manufacturer code letter from "D" - which had been shared with Douglas Aircraft - to "H", the KDD-1 being again redesignated, as KDH-1.

[7] A KDH-1 is displayed in the Steven F. Udvar-Hazy Center of the National Air and Space Museum, having been donated by the U.S. Navy in 1966.