The Type 105 or Bulldog Mk I prototype recorded its maiden flight on 17 May 1927 and soon revealed a pleasing combination of good handling and adequate performance, the latter including a maximum speed of 150 kt (173 mph; 278 km/h) at optimum altitude. Though officially it was flown outside the F.9/26 competition, the Type 105 was clearly superior to three of the official contenders (the Armstrong Whitworth A.W.XVI, Boulton Paul P.33 Partridge, and Gloster SS.19) and thus rivalled only by the Hawker Hawfinch, and the Air Ministry thereupon ordered a single Type 105A prototype for official evaluation as the Bulldog Mk II. This prototype recorded its maiden flight in January 1928, and differed from the Bulldog Mk I mainly in having an extended rear fuselage that increased overall length from 23 ft 0 in (7.01 m) to 25 ft 0 in (7.62 m), and a slightly revised wing cellule that reduced span from 34 ft 0 in (10.36 m) to 33 ft 10 in (10.31 m) and area from 307.00 sq ft (28.52 m²) to 306.50 sq ft (28.50 m²). The competition between the two types was particularly hard fought, but the Air Ministry in June 1928 selected the Bulldog Mk II as the winner largely on the grounds that it was of all-steel construction and therefore more durable than the Hawfinch, which was of steel and light alloy construction.
An initial order was placed for 25 aircraft, and these machines were delivered between May and October 1929, entering service with Nos 3 and 17 Squadrons as replacements for the Hawker Woodcock fighters that these two units had flown largely in the night-fighter role. The Air Ministry then ordered a second batch of aircraft, and these 23 machines were delivered in 1930 as the equipment of Nos 17 and 54 Squadrons. Other than those above, the details of the Bulldog Mk II included an empty weight of 2,200 lb (998 kg), maximum take-off weight of 3,490 lb (1583 kg), maximum speed of 155 kt (178 mph; 286.5 km/h) at 10,000 ft (3050 m), and service ceiling of 29,300 ft (8930 m). The Bulldog was already acquiring an excellent reputation for handling and performance, and this combined with the type's reputation for structural reliability and the low cost of its well-proved Jupiter engine to attract export orders. Some 12 aircraft with an armament of two Oerlikon machine guns and the powerplant of one Gnome-Rhône (Bristol) Jupiter VI or Gnome-Rhône 9Asb engine (10 and two aircraft respectively) were delivered in 1929 and 1930 to Latvia, which later sold 11 of them to Spain. Another 12 were delivered to Estonia in 1930 with the powerplant of one Gnome-Rhône (Bristol) Jupiter VI engine, and smaller orders were placed by Australia(eight aircraft delivered in January 1930 with the powerplant of one Jupiter VIF engine), Sweden (three aircraft used for evaluation of the Bulldog), Siam (two aircraft delivered in January 1930 with the powerplant of one Jupiter VII engine), the USA (two aircraft delivered to the US Navy in 1929 and 1930 for trials purposes, in the course of which the first machine was lost as a result of aileron flutter and separation in a terminal-velocity dive), and Japan (one aeroplane with the powerplant of one Nakajima [Bristol] Jupiter VII engine for evaluation). In Japan the Bulldog was extrapolated with Bristol assistance into the Nakajima JSSF with the Jupiter VII engine, but this variant's two prototypes did not pave the way for any production.
In May 1930 the Air Ministry ordered another 92 fighters to the improved Bulldog Mk IIA standard with the Jupiter VIIF engine rated at 440 hp (328 kW) for take-off and 520 hp (388 kW) at 10,000 ft (3050 m), revised wing spars, a measure of local strengthening to permit operation at higher weights, a redesigned oil system, and a wider-track main landing gear unit carrying larger wheels with Bendix tyres and wheel brakes; the aircraft were later revised with a modified fin and a tailwheel in place of the original tailskid. The other details of the Bulldog Mk IIA included the armament of two 0.303 in (7.7 mm) Vickers Mk II or Mk IIN fixed forward-firing machine guns with 600 rounds per gun together with four 20 lb (9.1 kg) bombs on a rack under the port lower wing, span of 33 ft 10 in (10.31 m) with area of 306.50 sq ft (24.47 m²), length of 25 ft 0 in (7.62 m), height of 9 ft 10 in (3.00 m), empty weight of 2,412 lb (1094 kg), maximum take-off weight of 3,530 lb (1601 kg) later increased to 3,660 lb (1660 kg), maximum speed of 154.5 kt (178 mph; 274 km/h) at 10,000 ft (3050 m) declining to 141 kt (162 mph; 261 km/h) at 20,000 ft (6095 m), climb to 20,000 ft (6095 m) in 14 minutes 30 seconds, service ceiling of 29,300 ft (8930 m), and range of 304 nm (350 miles; 563 km).
The aircraft were delivered between October 1930 and May 1931, and by the end of 1931 some 10 of the RAF's 13 home-based fighter squadrons were equipped with the Bulldog: these units were Nos 3, 17, 19, 23, 29, 32, 41, 54, 56 and 111 Squadrons. Orders were later placed for an additional 162 examples of the Bulldog Mk IIA, which was numerically the most important British fighter of the early 1930s. Yet the type was essentially an interim fighter whose performance was hampered by its use of a modestly rated radial engine in an uncowled installation: the advantages of this powerplant were its reliability and low purchase cost, but by the early 1930s its disadvantages were a basic lack of potential for development into significantly higher-rated forms and the emergence of powerful V-12 engines whose low-drag installations offered the possibility of much improved overall performance. Thus the replacement of the Bulldog began as early as 1933, when No. 23 Squadron converted to the Hawker Demon. The replacement process was slow, however, and it was June 1937 before the last unit, No. 3 Squadron, relinquished its Bulldogs.