During the 1960s, the Royal Canadian Air Force set out a requirement to replace the aging fleet of Canadair CC-106 Yukons and Canadair CC-109 Cosmopolitan transports. Initially, the Boeing KC-135 was being considered because the versatile design could also fulfill a yet-unspecified aerial refuelling role. Although a "purpose-built" aircraft would have suited the RCAF requirements better, an opportunity to acquire Boeing 707s as an alternative, soon presented itself.
Canada purchased five Boeing 707s in 1970-71 to replace the RCAF's CC-106 Yukons in the long range transport role and the CC-109 Cosmopolitan as an executive or short-range transport. The first four aircraft had been built for Western Airlines, but that order was subsequently cancelled; the fifth was bought separately a year later. To fulfil Canada's requirements for aerial refueling, two aircraft were fitted with Beechcraft made probe and drogue refueling pods in 1972. The two sets of refuelling equipment was moved from aircraft to aircraft to keep fleet utilization even between the airframes.
The CC-137 fleet had a combined total of 191,154 hours, remaining in service in the transport role until 1995, with two aircraft continuing in use as tankers until 1997.