The U.S. Army launched the CAR-15 Commando in 1966 and named it the "Submachine Gun, 5.56 mm, XM177E1". After feedback and suggestions from users, Colt improved the XM177E1. In 1967 the U.S. Army purchased it for the Its Military Assistance Command, Vietnam-Studies and Observations Group (MACV-SOG) in the new CAR-15 assault type variant and named it XM177E2.
Although the new flash hider could effectively reduce the muzzle flash, there were other serious problems. Due to the short muzzle and barrel length of the XM177E2, the gunpowder that has not been fully burned when firing will quickly block the flash hider. The flash hider, if it is not cleaned, will significantly lose its sound reduction benefits. In addition, the flash hider would also cause problems with the shooting accuracy of ordinary bullets, which was even more serious when using tracer bullets.