A large single engine passenger aircraft, the prototype Polikarpov PM-1 flew for the first time on 10 June 1925. It was an unequal-span biplane with the upper wing connected directly to the upper decking of the fuselage. The pilot had an open cockpit just forward of the wing leading edge and the enclosed cabin accommodated five passengers. The 'M' in the designation arose from the single 194kW Maybach IVa inline engine which gave a maximum speed of 170km/h.

Successful flight testing brought an order for 10 aircraft to operate on the routes of the German-Soviet airline Deruluft, but as the result of a crash in Germany it is believed that most of the series aircraft were cancelled.