Liquid-fueled rocketry began with Robert Goddard, a physics professor at Clark University in Worcester, Massachusetts, who flew the first such rocket in 1926, 12 years after receiving his first patent and seven years after publishing “A Method of Reaching Extreme Altitudes,” in which he argued that rockets could be used to explore the upper atmosphere. He learned quickly though, that flying rockets can have dangerous consequences, and in 1931, he relocated to the wide-open spaces of Roswell, New Mexico, after receiving a legal injunction to stop firing rockets near his home because some of them had crashed into a neighbor's property. In New Mexico, he expanded his activities.

 
Some American experimentation in rocketry prior to World War II grew in technical societies. This is an early rocket motor designed and developed by the American Rocket Society in 1932.

Although extremely talented, Goddard, however, worked virtually alone, establishing no company and attracting no protégés to continue his work. It fell to others, particularly companies and professional societies, to carry forth the practical development of rocketry.

This work started with a group of writers in New York City who contributed to Science Wonder Stories, one of the first sci-fi magazines. David Lasser, who wrote for the New York Herald Tribune, in 1930 invited them to form a group called the American Interplanetary Society. They met every two weeks in Manhattan's Museum of Natural History, where their first public event was a showing of a German sci-fi movie, “The Girl in the Moon,” with English subtitles. Soon, though, they advanced to work with real rockets.

A friend of Lasser, G. Edward Pendray, toured Europe in 1931, and met with rocket researchers in Berlin. One of these inventors showed him a test firing of a small liquid-fueled rocket. Entranced, Pendray returned to America with the hope of building such rockets in New York. Working with another Society member, Hugh Pierce, he built a rocket and tried to launch it from Staten Island in May 1933. It flew well for about two seconds before its tank of liquid oxygen exploded. Undismayed, the group renamed itself the American Rocket Society and put their hope in a new liquid-fuelled engine designed by a young engineer, John Shesta. It powered their next rocket, which went out of control and splashed into the water with its engine still firing loudly.

The New York area was not well suited for such flights. Pendray later wrote that his friends found “frequent and unannounced moving of the testing ground to be a wise and sometimes necessary precaution.” Their experiments nevertheless continued, focusing then on the work of a brilliant Princeton University student, James Wyld. His best rocket engine, tested in 1938, weighed only two pounds (0.9 kilograms) but delivered 90 pounds (400 Newtons) of thrust. An improved version, tested during 1941, proved to be reliable and fully satisfactory.

Just then another Society member, Lovell Lawrence, was working in Washington. War was imminent, and Lawrence thought he might be able to win a government contract. He attracted interest within the Navy, but learned that he needed a corporation to do business legally. He promptly set one up, called Reaction Motors, naming himself the president and Pierce, Wyld, and Shesta as the new company's officers, directors, employees, and stockholders. Early in 1942, with the Nation indeed at war, Lawrence received his contract.

 The nation's first U.S. Jet Assisted Take Off (JATO) used solid propellant that had been developed at Theodor von Karmanďs Guggenheim Aeronautics Laboratory (GALCIT). This flight took place at March Field, California, on August 12, 1941.

Reaction Motors' start-up capital was $5,000. Its initial shop was in the garage of Shesta's brother-in-law, but it soon moved to a former nightclub in Pompton Plains, New Jersey. The club's bar stools were still in place when they moved in. To test their engines, they found an isolated area in nearby Franklin Lakes.

There was activity as well on the West Coast, where noted aerodynamicist Theodore von Kármán was a professor at the California Institute of Technology (Caltech). In 1936, Frank Malina, one of his graduate students, won permission to design and test rockets as a research project. Malina couldn't fire them at Caltech itself, but found the open space he needed a few miles away at a place called Arroyo Seco, which means “dry gulch.”

Malina wanted to build solid-fuel rockets that would burn somewhat slowly, giving a prolonged push to help an airplane get off the ground. In 1940 he and Von Kármán devised a set of mathematical equations that showed them how to proceed. Von Kármán by then had won funding from the Army Air Corps, and Malina used some of the money to set up a rocket research centre in Arroyo Seco. His first buildings were small, with corrugated-metal roofs and unheated, drafty, and cramped interiors. Office space was so limited that for a time, one man worked out of the back seat of his car. Still, these arrangements served Malina's purposes.

His early solid propellants developed cracks, which led to explosions. However, fuel could be made from any material that would burn, and his chemist, John Parsons, decided to try other materials as rocket fuels, such as paving tar and asphalt, which flexed and did not crack. Parsons melted a batch in a kettle and stirred in a quantity of potassium perchlorate, an oxygen-rich compound that would make this fuel burn. It worked! The new propellant gave good thrust and did not crack. With this, Malina had the important invention of a long-burning solid propellant that did not readily explode.

Another colleague, Martin Summerfield, was interested in liquid-propellant rockets. Other people were using liquid oxygen, but this supercold liquid evaporated readily, and Summerfield wanted propellants that could be stored at room temperature. Parsons, the chemist, invited him to try red fuming nitric acid. Summerfield tried it with gasoline and kerosene as fuels, but his rocket engines chugged violently and either blew up or shut down. No one at Caltech knew what to do, so Summerfield consulted a Navy rocket man, Robert Truax.

 
The XLR11 was the first liquid-fuel rocket engine developed in the United States for use on airplanes. Designed and built by Reaction Motors, the engine used ethyl alcohol and liquid oxygen (LOX) as  propellants to generate a maximum thrust of 6,000 lbs. Thrust could be varied by operating the XLR11's four combustion chambers individually or in combination. The engine was first used in the Bell X-1 in 1947.

One of Truax's chemists suggested aniline as a fuel. “The results were spectacular,” Von Kármán later wrote. “Nitric acid and aniline took to each other beautifully. The flame in the engine was absolutely steady.” With this, Malina's researchers had another important invention: a liquid rocket that used storable propellants.

By then the Nation was at war, and Von Kármán saw that he could win military contracts by drawing on his excellent Washington connections. Again though, he needed a company, so, with help from his attorney, he established a company called, at Malina's suggestion, Aerojet. It opened for business in March 1942, with Von Kármán as president and the company office in an auto showroom in downtown Pasadena. The Arroyo Seco facilities continued to serve for rocket tests, though it was hard to get there since its dirt access road washed out when it rained. But this test area soon grew in importance. During 1944, it was reorganized as a center for guided-missile research, and took the name of Jet Propulsion Laboratory (JPL).

An Army colonel, Gervais Trichel, asked Von Kármán to take responsibility for a complete guided-missile program. They started with the Private, a small rocket that burned Parsons' mix of asphalt and perchlorate. Von Kármán then proposed to build the liquid-fuelled Corporal, with a range of 60 miles (97 kilometres). But the Corporal project called for a big leap in technology, and Malina argued that JPL should build a smaller liquid-fuelled rocket as an intermediate step. It took shape as the WAC Corporal, named after the wartime Women's Army Corps. Standing 16 feet tall, it reached an altitude of 44 miles (71 kilometres) on its first try, in October 1945.

Back east, Reaction Motors was active as well. Under Navy contract, it spent the war building larger versions of Wyld's engine, capable of producing 1000 pounds (4448 Newtons) and later 3000 pounds (13,345 newtons) of thrust. Then in 1945, employing all of 35 people, the firm won an Army assignment: to develop a rocket engine for the X-1, an experimental plane built to break the sound barrier. This appeared dangerous and perhaps impossible. In 1946 Geoffrey de Havilland Jr., a British test pilot, tried to fly faster than the speed of sound in a jet plane. His aircraft shook so violently that it broke up in midair and killed him.

 
The Bell Aircraft Corporation X-1-1 in flight. The X-1 used a rocket engine built by Reaction Motors.

The Reaction Motors engine gradually emerged as a simple design using four Wyld-type units, each with 1500 pounds of thrust. The test pilot could light them one by one, for 25, 50, 75, or 100 percent of the full thrust of 6000 pounds (26,689 Newtons).