The development of a Czech light multi-purpose helicopter began at the end of the 1950s. Hover test flights of the Zlin XZ-35 prototype established that the design was quite successful but that a more powerful engine was required. Installation of the larger, more powerful six-cylinder Avia M-337 engine necessitated the ugly bulge in the nose and the design was named Z-135. It was looking goob but then the Czechoslovak government decided to stop all helicopter development in the country. In 1974 this sinle prototype was handed over to the Letecké Muzeum Kbely for display.

Designed by the Morovan works, the Z-35 was a two-seat helicopter first flown in 1960. After an accident in the Tatra Mountains this machine was rebuilt as the Z-135 with a more powerful Walter M-337 engine in a revised nose. The project was dropped, however.