In 1971 the USAF began to put together the specification of a new transport as a possible replacement for its fleet of Lockheed C-130 Hercules aircraft. The Hercules design had originated from a specification of just 20 years earlier, and in putting together its requirement for this new transport, the USAF planners had in mind the very important development in powerplants and aerodynamics which had taken place since 1951. In early 1972 requests for proposals were sent out to nine US manufacturers, and those of the Boeing Company and McDonnell Douglas Corporation were selected for competitive evaluation under the respective designations YC-14 and YC-15.

Before the allocation of designations, the USAF specification had the identification AMST, signifying Advanced Military STOL Transport, and the emphasis required from the successful contenders was -concerned primarily with STOL (short take-off and landing) capability. The Boeing Model 953 design for STOL performance was based on the use of a supercritical wing, developed by NASA from the wind-tunnel research of Dr Richard Whitcomb, which provides highly efficient performance from the wing at high subsonic speeds. To this wing Boeing added an advanced wing upper-surface blowing concept, mounting the twin engines above the wing so that their efflux was exhausted over the wing. With the wing's leading-edge and Coanda-type trailing-edge flaps extended, the high-speed airflow from the engines tended to cling to the upper surface of the wing/flap system, and was thus directed downwards to provide powered lift.

The YC-14 first flew on 9 August 1976, and soon proved to have admirable performance. Maximum payload was 150 troops or 36,742kg of freight in conventional operations, while for STOL operations from an airfield of less than 572m the payload was still a useful 12,247kg.

At the completion of testing, in the late summer of 1977, the YC-14 prototype was returned to Boeing for continuing development, if the company so wished, but no further government funding for development or procurement was forthcoming.