Yugoslavia purchased both 1895 Nagant revolvers and TT33 Tokarev form the Soviet Union after World War Two, but this was only a holdover until domestic pistol production could begin. While Yugoslavia was formally communist, Tito was not a puppet of Moscow, and Yugoslavia did their own development to reverse-engineer the Tokarev pistol. In the process, they made a number of improvements to the design, resulting in the M57. Serial production began in 1963 and lasted until 1982, with about 270,000 made in total. It was the standard sidearms for the Yugoslav People's Army and Yugoslav police forces until 1988.

The changes made from the standard Soviet pattern Tokarev include:
- Longer grip and 9-round magazine capacity
- Captive recoil spring
- Improved front sight
- Stronger firing pin with improved retention system
- Magazine disconnect safety