The He 176 was to be the ﬁrst aircraft in history to ﬂy using only liquid-fueled rocket power. Design work was begun in late 1936, with detailed engineering drawings being completed around July 1937. Construction of the prototype began at the same time. All design work for the Heinkel He 176 was done in Sonderentwicklung I, a department that was kept isolated from the remainder of the Heinkel factory at Rostock-Marienehe. The main designers of the He 176 were Walter Künzel (project leader), Walter Günter (aerodynamics), Adolf Jensen (ﬂight mechanics), and H. Bosch (loading and stress analysis).
The He 176 featured a circular cross-section fuselage with the diameter being barely large enough for a pilot to be seated in a reclining position. The stubby wings, which were really little more than control surfaces, had an elliptical form with a straight leading edge, and featured positive dihedral. Behind the cockpit were located the fuel tanks (methanol and super hydrogen oxide) and the Walter HWK R1 liquid-propellant rocket engine. A tail-dragger-type retractable landing gear was chosen with a ﬁxed-nose wheel added for taxi and towing trials. The extensive cockpit glazing provided an excellent view, and in an emergency the entire forward cockpit section could be jettisoned via an explosive charge, after which a braking parachute enabled the pilot to bail out.
The Heinkel He 176 had a wingspan of 4 m (13 ft 1 in), a length of 5.2 m (17 ft 1 in), a height of 1.50 m (4 ft 11 in), a wing area of 5.5 square m (59.2 square ft), and a weight (empty) of 1,570 kg (3,462 lbs). Theorical speed was to be 750 km/h (466 mph) and maximum range was 110 km (68 miles). In July 1938 the He 176 was tested at the large wind tunnel at Göttingen. Although the He 176 program was begun at the Heinkel factory at Rostock-Marienehe, the completed prototype was soon moved to Peenemünde, where better secrecy could be maintained. Tests were conducted, and the ﬁrst short air hops took place in March 1939 under rocket power. The ﬁrst ofﬁcial ﬂight of the Heinkel He 176 V1 was on June 20, 1939 ﬂown by Flugkapitän Erich Warsitz. On the next day, June 21, the He 176 was demonstrated in front of some of the RLM leaders (including Ernst Udet and Erhard Milch). Udet was not impressed, and prohibited further tests due to the inherent dangers of rocket ﬂight. This ban was twice lifted and twice issued again until July 3, 1939, when another demonstration was arranged at Roggentin for Adolf Hitler himself and more of the Third Reich leadership. An ofﬁcial order was issued in September 1939 terminating any further work on the He 176 project. The prototype aircraft stayed under wraps for years at the Heinkel factory at Rostock-Marienehe, but was eventually crated up and sent to the Air Museum in Berlin, where it was destroyed in an air raid in 1944.