Initially, design was started on a single-seat fighter by Dmitry Pavlovich Grigorovich, to compete with the Polikarpov I-1 biplane. The finished aircraft, finalised in 1924 and produced at Factory No. 1, at Khodinka, near Moscow, was a single-seat, single-bay biplane of wooden construction, with the forward portion of the fuselage being covered in plywood and the rear having fabric skinning. In development, a major problem was that of engine cooling - various methods were tested including radiators attached to the undercarriage legs, but in the end a radiator suspended beneath the engine was used.
After an initial flight in January 1924, testing took place in the spring of that year. The I-1 was found to have adequate speed for its purpose but its construction and therefore its flight were unstable, and its climb rate was found to be insufficient with repeated stalls. Therefore the prototype was abandoned, and Grigorovich refined the design into the Grigorovich I-2 which later entered service in the Soviet Air Force.