The subsequent Sino-Soviet split ended the development relationship, and from July 28 to September 1, 1960, the Soviet Union withdrew its advisers.

Compounding the problem, other domestic political turmoil such as Great Leap Forward further hindered the Chinese development of torpedoes.

Chinese researchers decided that compressed oxygen powered torpedo was unsuitable for a number of reasons: Compressed Oxygen is highly volatile, and the logistical support required was costly and complex, additionally it required a highly trained crew.

The 7th Academy made a top priority in 1963 to order machine tools for the torpedo factory, while with the approvals of both the National Science and Technology Committee and the National Defense Science and Technology Committee, over two dozen experts including the best machine tool operators were assigned to the torpedo factory from other areas including Nanjing.

The only way to build cylinders that meet the requirement was to use a brand-new method to cast a newly developed copper alloy, which took the joint effort of a total of 40 enterprises with more than several dozen attempts until they were successful.

For example, Mr. Zhao Zhongfa (赵忠发) made critical inputs that were instrumental in successful production techniques.

Capitalizing on the success, Luo Chuanli (骆传骊) of the 705th Institute led a team of researchers to Pinyang Machinery Factory[1] (平阳机械厂) in Houma, Shanxi, to assist the general design engineer Li Fengku (李风库) and his team of the factory to speed up the next stage of the development.

In the meantime, 705th Institute and East Wind Instrumentation Factory[2] (东风仪表厂) in Xi'an jointly developed the gyroscope for the torpedo.

In March 1970, additional tests begun at different places, including Lushun, Zhoushan, and Qinghai, and lasted 18 months, over 500 times and using 104 samples.

However, the Chinese microelectronics industry was not capable to produce the passive acoustic homing guidance according to the original plan, but due to the urgent need, the original plan changed one last time with unguided version was pressed into service as Yu (鱼) -1 (in September 1971), while the passive acoustic homing guided version was named Yu-1 Jia (鱼-1甲), sometimes also known as Yu-1G, which would take years to complete.