The Stirling was designed during the late 1930s by Short Brothers to conform with the requirements laid out in Air Ministry Specification B.12/36. Prior to this, the RAF had been primarily interested in developing increasingly capable twin-engined bombers but had been persuaded to investigate a prospective four-engined bomber as a result of promising foreign developments in the field. Out of the submissions made to the specification, Supermarine proposed the Type 317 which was viewed as the favourite, while Short's submission, named the S.29, was selected as an alternative. When the preferred Type 317 had to be abandoned, the S.29, which later received the name Stirling, proceeded to production.
During early 1941, the Stirling entered squadron service. During its use as a bomber, pilots praised the type for its ability to out-turn enemy night fighters and its favourable handling characteristics, while the altitude ceiling was often a subject of criticism. The Stirling had a relatively brief operational career as a bomber before being relegated to second line duties from late 1943. This was due to the increasing availability of the more capable Handley Page Halifax and Avro Lancaster, which took over the strategic bombing of Germany. Decisions by the Air Ministry on certain performance requirements, such as to restrict the wingspan of the aircraft to 100 feet, had played a role in limiting the Stirling's performance; these restrictive demands had not been placed upon the Halifax and Lancaster bombers.
During its later service, the Stirling was used for mining German ports; new and converted aircraft also flew as glider tugs and supply aircraft during the Allied invasion of Europe during 1944–1945. In the aftermath of the Second World War, the type was rapidly withdrawn from RAF service, having been replaced in the transport role by the Avro York, a derivative of the Lancaster that had previously displaced it from the bomber role. A handful of ex-military Stirlings were rebuilt for the civil market.
In the 1930s, the Royal Air Force (RAF) was interested primarily in twin-engine bombers. These designs put limited demands on engine production and maintenance, both of which were already stretched with the introduction of so many new types into service. Power limitations were so serious that the British invested heavily in the development of huge engines in the 2,000 horsepower (1,500 kW) class in order to improve performance. During the late 1930s, none of these were ready for production. Both the United States and the Soviet Union were pursuing the development of bombers powered by arrangements of four smaller engines, the results of these projects proved to possess favourable characteristics such as excellent range and fair lifting capacity. Accordingly, in 1936, the RAF also decided to investigate the feasibility of the four-engined bomber.
The British Air Ministry published Specification B.12/36, which called for a high-speed, long-range four-engined strategic bomber aircraft, that would be capable of being designed and constructed at speed. Amongst the several requirements specified, the bomb load was to be a maximum of 14,000 lb (6,350 kg) carried to a range of 2,000 miles (3218 km) or a lesser payload of 8,000 lb (3,629 kg) to 3,000 miles (4,800 km) (incredibly demanding for the era). It was to have a crew of six and was to have a normal all-up weight of 48,000lb, while a maximum overload weight of 65,000lb was also envisioned. The aircraft would have to be capable of cruising at speeds of 230 mph or greater while flying at 15,000 ft (4,600 m), while possessing three individual gun turrets (located in nose, amidships and rear positions) for self-defence.
Additionally, the prospective aircraft should also be able to be used as a troop transport for 24 soldiers, and be able to use catapult assistance for take off. The concept was that the aircraft would fly troops to far corners of the British Empire and then support them with bombing. To help with this task as well as ease production, it needed to be able to be broken down into parts, for transport by train. Since it could be operating from limited "back country" airfields, it needed to lift off from a 500 ft (150 m) runway and be able to clear 50 ft (15 m) trees at the end, a specification most small aircraft would have a problem with today. Aviation author Geoffrey Norris observed that the stringent requirements given in the specification for the prospective aircraft to be able to make use of existing infrastructure, specifically the specified maximum wingspan of 100 feet, negatively impacted the Stirling's performance, such as its relatively low altitude ceiling and its inability to carry anything larger than 500lb bombs.
Various companies responded to B.12/36, including Supermarine and Armstrong Whitworth. Initially left out of those asked to tender designs, Shorts were later included because the company already had similar designs in hand while possessing ample design staff and production facilities to fulfil foreseen production commitments. Shorts were producing several four-engined flying boat designs of the required size and created their S.29 proposal by removing the lower deck and boat hull of the S.25 Sunderland. The new S.29 design was otherwise largely identical to the Sunderland: the wings and controls were the same, construction was identical and it even retained the slight upward bend at the rear of the fuselage, which had originally been intended to keep the Sunderland's tail clear of sea spray. As originally designed, the S.29 was considered to be capable of favourable high-altitude performance.