Like most other nations with modern military forces. Czechoslovakia was interested in developing a semiautomatic infantry rifle in the 1920s and 1930s. The most successful such rifle to come out of Czech factory during this time was The ZH-29, but it did have competition. A major series of trials was held in 1937 and 1938, and the CZ entrant was this Model 38 rifle.

It uses a tilting bolt with many similarities to the ZB-26 light machine gun and ZH-29 rifle, along with a short stroke gas piston. Interestingly, its charging handle is designed to mimic the manual of arms of the then-standard Mauser bolt action rifles - the handle must be rotated 90 degrees up before pulling the bolt back, and then rotated back down before firing. The CZ model 38 also used a fixed 10-round magazine fed by stripper clips instead of a detachable box magazine.

The model 38 apparently did not do well in the adverse conditions testing. None of the other rifles in the trial were good enough to be judged adequate, though, and more development and trial continued afterwards. The rifle ultimately chosen used an annular gas piston, but was never put into production because of World War II. That design would reappear after the war and lead to the vz.52 rifle.