It was designed to replace the M16 smoke grenade, which did not burn as long or as vividly. It was designated standard issue in the fall of 1943. Both were produced at the same time as the M16 production lines were already setup when the M18 was adopted.
A new smoke grenade was developed to replace the M16 model, which had a shorter and less vibrant burn time. The M18 was officially designated as standard issue in the fall of 1943. Both grenades were produced simultaneously with the M16 production lines already operational when the M18 was adopted.