A slight performance improvement was seen at low-altitude but the engine experienced overheating problems due to the cooling and oil systems remaining unchanged from the AM-35A.

[2] The AM-38 was a low-altitude engine for ground attack aircraft that evolved from the earlier AM-35A.

Compared to the AM-35A it had a reduced compression ratio, strengthened crankshaft, a single-speed geared centrifugal supercharger optimized for low-altitude performance, revised cooling system and revised oil system.

The first examples were produced in October 1939 and passed its Factory tests in November 1939.

The AM-38 was the most produced Mikulin engine with 43,191 built by the time it was phased out of production in 1946.