A replacement for the Kfz 13 and Kfz 14 was developed by Eisenwerk Weserhütte of Bad Oeynhausen and was to be used for reconnaissance.
The chassis was made from a standard Auto-Union Horch 801 (heavy car) chassis with an armored body and turret.
The SdKfz 221's chassis was built by Auto-Union in Zwickau and they were assembled by F. Schichau of Elbing and Maschinenfabrik Niedersachsen in Hannover-Linden.
The engine was placed in the rear.
All four wheels were steered when turning.
The armor was rolled and welded at an angle. The early models had visions ports cut from the rolled plates, and these were simplified by making cast vision ports.
Had a seven sided turret, sometimes with a grenade netting over the top.