The Type 540 Gal-class submarine is a slightly modified variant of the German HDW Type 206 submarine class, modified for Israeli requirements. The Gal class submarines were built to Israeli specifications as the Vickers Type 540 at the Vickers shipyards in Barrow-in-Furness in the UK rather than Germany for political reasons. "Gal" was the name of the son of Abraham (Ivan) Dror, 3rd commander of the squadron and head of the project.

The Type 206 is a class of diesel-electric submarines (U-boats) developed by Howaldtswerke-Deutsche Werft (HDW). Its design is based on the preceding Type 205 submarine class. These small and agile submarines were built during the Cold War to operate in the shallow Baltic Sea and attack Warsaw Pact shipping in the event of military confrontation. The pressure hulls were built out of non-magnetic steel to counter the threat of magnetic naval mines and make detection with MAD sensors more difficult. The low emission profile allowed the submarines in exercises to intrude even into well-protected opposing forces such as carrier formations with their screen.