The first two prototype torpedoes were assembled in No. 874 Factory in December 1984 and were tested in the 750 Testing Range (750试验场) in Kunming in December 1985.
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705th Institute (also known as Xi'an Precision Machinery Research Institute, 西安精密机械研究所) was responsible for the shallow water control systems of the torpedo and Northwestern Polytechnical University was responsible for the deep water control systems of the torpedo.
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The Bush Administration had faced significant criticism from congress and many human rights activist groups for delivering the last batch of Mk 46 Mod. 2 torpedo to China after the Tiananmen Square protests of 1989, but the Bush Administration countered that the delivery was the completion of a previous deal made prior to the crackdown.
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705th Institute (also called Xi'an Precision Machinery Research Institute, 西安精密机械研究所) and Northwestern Polytechnical University were tasked with being the research team, while the No. 872 Factory and No. 874 Factory were assigned as the production facility.
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