The weapon was introduced into PLA service in 1981 but did not become widely distributed until the late 1980s. It replaced the Type 56. Its first combat use came during the Sino-Vietnamese border conflicts of the mid 1980s.
Unlike its predecessors, the Type 81 is a series of weapons. The Type 81 and Type 81-1 are assault rifles and the heavier Type 81 squad machine gun is used in the squad automatic weapon role.
The Type 81-1 is similar to the Type 81 but has a collapsible stock. The Type 81 squad machine gun is heavier (5.15 kg), has a longer barrel, slightly higher rate of fire (700 rounds per minute), and fires from either the standard 30 round magazine or a 75 round drum. According to PLA soldiers and foreign users (mainly in Africa), the accuracy of the Type 81 is better than that of the AK-47 and close to that of the M-16, while the reliability is equal to that of the AK-47.
A prototype called the Type 87 was introduced in the late 1980s. It served as a development platform for the next generation of PLA small arms, being used as a test-bed for the then new 5.8 x 42 mm DBP87 ammunition. It never went into full-scale production.
The PLA is scheduled to replace the Type 81 with the Type 95 series of weapons in the future but full conversion is not expected until the mid 2010s.