In 1958 several US contractors demonstrated that large ballistic missiles could be launched from strategic bombers at high altitude. Using astro guidance systems for mid-flight corrections of an intertial guidance system, similar to that of the US Navy's systems, led to accuracy similar to that of their existing ground-based systems.
The USAF was interested, and sent out tenders for development systems in 1959. Douglas Aircraft received the prime contract in May, and in turn subcontracted to Northrop (guidance system), Aerojet General (propulsion), and General Electric (reentry vehicle). Initially being known as WS-138A, in 1960 the project was given the name GAM-87 Skybolt.
At the same time the Royal Air Force was having problems with their own missile project, the long-overdue Blue Streak ICBM. Not only was the missile long overdue and overbudget, but the limited land area available on the British isles meant that it would be fairly easy for the USSR to directly attack the silos. They felt that the Skybolt would provide a much safer basing system, while at the same time allowing their V Bomber fleet to present a credible threat, with a long standoff range keeping them well away from the ever-increasing PVO Strany air defenses. Prime Minister MacMillan met President Eisenhower and agreed to purchase 144 Skybolts for the RAF, and Blue Streak was cancelled.
The GAM-87 was ballistic missile powered by a two-stage solid-fuel rocket motor. Each B-52H was to carry four missiles, two under each wing on side-by-side pylons, while the Avro Vulcan carried one each on smaller pilons. The missile was fitted with a tailcone while on the pilot, which was ejected shortly after being dropped from the plane. After first stage burnout the Skybolt coasted for a while before the second stage ignited. First stage control was by movable tail fins, while the second stage was equipped with a gimballed nozzle.
By 1961 several test articles were ready for testing from USAF B-52's, with drop-tests starting in January while in England compatibility trials with mockups started on the Vulcan. Powered tests started in April 1962, but the test series was a disaster, with the first five trials ending in failure.
The first fully successful flight occurred on December 19th, 1962, but on that same day the whole program was cancelled and the production of the operational GAM-87A stopped. The US simply had no need for the missile any more, with improved silo-based missiles and SLBMs making their counterforce largely invunerable anyway.
This left the RAF, and the British forces as a whole, in a terrible position, as development of both their ICBM and a newer standoff missile for their V Bombers had both been cancelled. This left them with no credible nuclear deterrant. The program was offered to the British to continue funding, but instead US Secretary of State McNamara persuaded them to buy the Polaris SLMB, and thus the nuclear deterrant was passed from the RAF to the Royal Navy.
Limited flight tests with the remaining XGAM-87A missiles continued after program cancellation, and in June 1963, the XGAM-87A was redesignated as XAGM-48A.