The plane was first developed in 1964 and 1965 as a short haul commuter designed to carry between 13 and 18 passengers.

It was originally built to fulfill the needs of the Ontario Department of Lands, and thus, was designed with short takeoff and landing capabilities. The Twin Otter is sometimes compared to a helicopter since it has such a steep takeoff and landing ability, requiring only a short runway.

The Twin Otter 100, or "first series," had a cruising speed of 297 kilometres per hour and a range of 1,427 kilometres. If the Twin Otter was loaded with 974 kilograms, its range was 1,344 kilometres. The 300 series had a cruising speed of 338 kilometres per hour without a load.

Over 800 of the rugged, small passenger aircraft have been produced.