During the mid-1950s, Northrop officials decided to adapt the N-156 to suit a recently issued general operating requirement by the United States Air Force (USAF) for a supersonic trainer to replace the Lockheed T-33.

The bid was successful, in no small part on its lower lifecycle cost comparisons to competing aircraft, and the company received an initial order to build three prototypes.

Other T-38s were previously used by the US Navy for dissimilar air combat training until replaced by the similar Northrop F-5 Tiger II.

In September 2018, USAF announced the possible replacement of the Talon by the Boeing–Saab T-7 Red Hawk, by 2034, if a planned initial low rate production, of the T-7A occurred by 2026, dependent on congressional approval, and aircraft are received, evaluated, and receive Initial Operating Capability, by the USAF, in 2027.

[2] In 1952, Northrop began work on a fighter project, the N-102 Fang, with shoulder-mounted delta wing and a single engine.

[3] The proposed General Electric J79 engine, weighing nearly two tons, meant the resulting aircraft would be large and expensive.

Upon seeing the engine, Northrop VP-Engineering Edgar Schmued saw the possibility of reversing the trend toward the large fighters.

Northrop launched its N-156 project in 1954, aiming for a small, supersonic fighter jet capable of operating from the US Navy's escort carriers.

Although the F-100 was not considered the ideal candidate for a training aircraft (it is not capable of recovering from a spin),[6] NAA was still considered the favorite in the competition due to that company's favored-contractor status with the USAF, but Northrop officials presented lifecycle cost comparisons that proved to be highly persuasive amongst USAF officials.

The first production examples were delivered in 1961, entering service on 17 March 1961, complementing the Cessna T-37 Tweet primary jet trainer.

The USAF had a small number of aircraft converted for weapons training, designated AT-38B, which were fitted with a gunsight and could carry a gun pod, rockets, or bombs on a centerline pylon.

Around a third of the fleet, those that experience more severe usage, are currently undergoing structural replacements and upgrades, as well as receiving new wings, to extend their service life to 2029.

In 2018, the Iranian Air Force announced that an outwardly similar aircraft, named the Kowsar, had been constructed within Iran.

[12][13][14] The Northrop T-38 Talon is of a conventional configuration, with a small, low-mounted, long-chord wing, a single vertical stabilizer, and tricycle undercarriage.

The flight controls were hydraulically-powered and lacked manual reversion, and thus the aircraft would be unflyable in the event of both engines failing mid-flight.

While it was originally considered to be too easy to fly compared with frontline fighters of the 1960s, by the twenty-first century, it had become regarded as the most challenging aircraft in the USAF's inventory.

[7] The aircraft's twin General Electric J85-5A turbojet engines were accommodated within the fuselage to exert less drag and produce fewer aerodynamic disturbances.

The J85-5A engine, despite generating up to 3,850 lb of static thrust, was relatively compact and lightweight for the era, weighing less than 600 pounds.

[7] To avoid removing the vertical fin while changing an engine, the fin was attached directly to the keel structure between the engines, and instead detaching the horizontal stabilizer along with the entire aft shell of the fuselage that surrounds the engines, which could be removed relatively easily via undoing several fasteners that hold the fuselage shell together and disconnecting two push rods that connect the pilot's control stick to the horizontal stabilizer's hydraulic actuators.

[16] Prior to the USAF ceasing the practice of trainees flying within icy conditions, the T-38's engines were prone to being damaged by ingesting ice.

Several incidents, including fatalities, have occurred due to imprecise management of the throttles and air speed during landing attempts.

[20] Bidders included a joint venture of BAE Systems and Rolls-Royce, offering the Hawk trainer, equipped with Rolls' Adour Mk951 engine with FADEC.

[24] In 1966, two Project Gemini astronauts, Elliot See and Charles Bassett, died when their T-38 hit the roof of a McDonnell Douglas fabrication building at Lambert Field in St. Louis.