The H5Y was designed by Yokosuka to meet an Imperial Japanese Naval Air Service's requirement for a twin-engine maritime reconnaissance flying boat, which was intended to match the performance of contemporary four-engine flying boats while being cheaper to build and easier to maintain.

Performance was found to be poor however, with the aircraft underpowered and suffering from structural problems, which delayed production.

Yokosuka Naval Air Arsenal built the aircraft at the Dai-Juichi Kaigun Kokusho facility.

[4] Although some were used for coastal anti-submarine patrols early in World War II, they were quickly transferred to second-line duties such as transport or training.

[1] Data from Warplanes of the Second World War, Volume Five: Flying Boats[1]General characteristics Performance Armament