Background
The company was founded from the firms of James Smith McDonnell and Donald Wills Douglas. Both men were of Scottish ancestry, graduates of MIT and had worked for the aircraft manufacturer Glenn L. Martin Company. Douglas had been chief engineer at Martin before leaving to establish Davis-Douglas Company in early 1920 in Los Angeles. He bought out his backer and renamed the firm the Douglas Aircraft Company in 1921.

McDonnell founded J.S. McDonnell & Associates in Milwaukee, Wisconsin in 1928. His idea was to produce a personal aircraft for family use. The economic depression from 1929 ruined his ideas and the company collapsed. He went to work for Glenn L. Martin. He left in 1938 to try again with his own firm, McDonnell Aircraft Corporation, this time based near St. Louis, Missouri.

The war was a major earner for Douglas. The company produced almost 30,000 aircraft from 1942 to 1945 and the workforce swelled to 160,000. The company produced a number of aircraft including the C-47 (based on the DC-3), the DB-7 (known as the A-20, Havoc or Boston), the Dauntless and the A-26 Invader. Both companies suffered at the end of hostilities, facing an end of government orders and a surplus of aircraft. Both heavily cut their workforces, Douglas sacking almost 100,000 people. As part of their wartime work Douglas had established a United States Army Air Forces think-tank, a group that would later become the RAND Corporation.

Douglas continued to develop new aircraft, including the successful four-engined DC-6 (1946) and their last prop-driven commercial aircraft, the DC-7 (1953). The company had moved into jet propulsion, producing their first for the military - the conventional F3D Skyknight in 1948 and then the more 'jet age' F4D Skyray in 1951. Douglas also made commercial jets, producing the DC-8 in 1958 to compete with the new Boeing 707. McDonnell was also developing jets, but being smaller they were prepared to be more radical, building on their successful FH-1 Phantom to become a major supplier to the Navy with the Banshee, Demon, and the Voodoo. The advent of the Korean War helped push McDonnell into a major military fighter supply role, especially with the noted F-4 Phantom II (1958).

Both companies were eager to enter the new missile business, Douglas moving from producing air-to-air rockets and missiles to entire missile systems under the 1956 Nike program and becoming the main contractor of the Skybolt ALBM program and the Thor ballistic missile program. McDonnell made a number of missiles, including the unusual ADM-20 Quail, as well as experimenting with hypersonic flight, research that enabled them to gain a substantial share of the NASA projects Mercury and Gemini. Douglas also gained contracts from NASA, notably for part of the enormous Saturn V rocket. Both companies were now major employers, but both were having problems.

Merger with Boeing
Following Boeing's 1996 acquisition of Rockwell's North American division, McDonnell Douglas merged with Boeing in 1997 in a US$13 billion stock-swap to create The Boeing Company.

A failed joint venture in China was a major cause of McDonnell Douglas's downfall, as chronicled in Joe Studwell's book The China Dream. He describes McDonnell's returns for two decades in China as "40 Sino-US marriages among its staff and untold embarrassment."

Products
AH-64 Apache (started under Hughes Helicopters)
F-4 Phantom II (started under McDonnell Aircraft)
F-15 Eagle
F/A-18 Hornet
DC-9 (started under Douglas Aircraft)
DC-10 (with cockpit upgrade designated MD-10)
MD-11 (stretched and modernized version of the DC-10)
MD-80 Series (stretched version and modernized of the DC-9)
MD-90 (stretched and modernized version of the MD-80)
MD-95 (latest evolution of the DC-9, sold as Boeing 717)