On 9 October 1945, the USAAF signed a letter of intent covering the engineering development for two prototypes (US serial numbers "46-523/4"), although the contract was not finalized until February 1947. After the successful conclusion of two reviews of a wooden mock-up in 1946 and 1947 by USAAF engineering staff, McDonnell constructed two prototypes in late 1947. The Model 27D was re-designated XP-85, but by June 1948, it was changed to XF-85 and given the name "Goblin". There were plans to acquire 30 production P-85s, but the USAAF took the cautious approach – if test results from the two prototypes were positive, production orders for more than 100 Goblins would be finalized later.