First in what be a long line of excellent aircraft designs up to the modern day, the Saab 17 was a conventinal dive bomber built from the company's experience in license-producing foreign aircraft such as the Douglas A-17, Junker Ju 86, and North American NA-16. It had been originally intended as a two-seat reconnaissance aircraft but was ultimately redeveloped to the dive bomber role which accounted for the bulk of all units built. Engine development was also controversial with initial versions equipped with license-built Bristol Mercurys and later models with copies of the Twin Wasp (unlicensed). Besides its traditonal role, many Saab 17s were used as twin float maritime patrol aircraft while others were fitted with retractable skis for use on snow covered fields. Foreign operators included Denmark and Ethopia with many remaining in service until the mid-1950s.

The first of two prototypes flew on 19 May 1940 and entered service as the B 17B dive bomber with Mercury engines which was later followed by the B 17A with Twin Wasps. Other variants included the B 17C with Piaggio engines, the S 17B camera-equipped reconnaissance aircraft and the S 17BS maritime patrol plaform based on the B 17B.