In late 1994 Microsoft was just on the verge of releasing its next operating system, Windows 95. The main factor that would determine the value consumers would place on their new operating system very much rested on what programs would be able to run on it. Three Microsoft employees — Craig Eisler, Alex St. John, and Eric Engstrom — were concerned, because programmers tended to see Microsoft's previous operating system, MS-DOS, as a better platform for game programming, meaning few games would be developed for Windows 95 and the operating system would not be as much of a success.
DOS allowed direct access to video cards, keyboards and mice, sound devices, and all other parts of the system, while Windows 95, with its protected memory model, restricted access to all of these, working on a much more standardized model. Microsoft needed a way that would let programmers get what they wanted, and they needed it quickly; the operating system was only months away from being released. Eisler, St. John, and Engstrom worked together to fix this problem, with a solution that they eventually named DirectX.
The first version of DirectX released was shipped September of 1995 as the Windows Games SDK. It was the Win32 replacement for the DCI and WinG APIs for Windows 3.1. A development team at ATI brought fundamental game graphics technology to the attention of Microsoft. The development of DirectX was led by the team of Eisler (development lead), St. John, and Engstrom (program manager). Simply put, it allowed all versions of Microsoft Windows, starting with Windows 95, to incorporate high-performance multimedia. Eisler wrote about the frenzy to build DirectX 1 through 5 in his blog.
Prior to DirectX's existence, Microsoft had already included OpenGL on their Windows NT platform. At the time, OpenGL required "high-end" hardware and was limited to engineering and CAD uses. Direct3D (introduced by Eisler, Engstrom, and St. John as an alternative to SGI's OpenGL) was intended to be a lightweight partner to the back then slower OpenGL for game use. As the power of graphics cards and the computers running them grew, OpenGL became the de-facto standard and a mainstream product. At that point a "battle" began between supporters of the cross-platform OpenGL and the Windows-only Direct3D, which many argued was another example of Microsoft's embrace, extend and extinguish business tactic (see Fahrenheit or Direct3D vs. OpenGL). Nevertheless, the other APIs of DirectX are often combined with OpenGL in computer games because OpenGL does not include all of DirectX's functionality (such as sound or joystick support). However, the combination of OpenGL and SDL for this purpose is becoming increasingly popular.
In a console-specific version, DirectX was used as a basis for Microsoft's Xbox and Xbox 360 console API. The API was developed jointly between Microsoft and NVIDIA, who developed the custom graphics hardware used by the original Xbox. The Xbox API is similar to DirectX version 8.1, but is non-updateable like other console technologies. The Xbox was code named DirectXbox, but this was shortened to Xbox for its commercial name.
In 2002 Microsoft released DirectX 9 with support for the use of much longer shader programs than before with pixel and vertex shader version 2.0. Microsoft has continued to update the DirectX suite since then, introducing shader model 3.0 in DirectX 9.0c, released in August 2004.
As of April 2005, DirectShow was removed from DirectX and moved to the Microsoft Platform SDK instead. DirectX is, however, still required to build the DirectShow samples.