The M2 Hyde-Inland was submitted as a simplified Submachine gun design to replace the M1928 Thompson. It was a more reliable design and more accurate in full automatic then the Thompson. It was originally intended to replace the Thompson with the M2 and keep the Thompson as a back-up, but due the disruption in manufacturing this would create, it was decided to have the M2 as secondary.
However, by the time the production line had been set up and issues had been sorted, the M3 Grease Gun had been chosen as the new sub-machinegun. Fewer then 500 were made and none were issued to Army units.