The first three boats were laid down in late 1917 and early 1918 by Austriawerft in Trieste, but none were launched or completed before the end of the war.

Austria-Hungary's U-boat fleet was largely obsolete at the outbreak of World War I, and over the first two years of the war the Austro-Hungarian Navy focused its efforts on building a U-boat fleet for local defense within the Adriatic.

Beginning in 1916, the Navy began building larger, ocean-going vessels for operation in the wider Mediterranean, outside the Adriatic.

[2] With six of the larger submarines under construction, the Navy considered either building German Type UB III submarines under license or implementing the Type 1916 S 1 design submitted by Ungarische Unterseebotsbau AG (UBAG) of Fiume.

For propulsion, the design featured two shafts, with twin diesel engines of 1,060 bhp (790 kW) (total) for surface running at up to 13.25 knots (24.54 km/h), and twin electric motors of 788 shp (588 kW) (total) for submerged travel at up to 8.25 knots (15.3 km/h).