Ignác Šustala (1822 - 1891), founder of the company in Kopřivnice, Moravia, started the production of horse-drawn vehicles in 1850. In 1891 he branched out into railroad cars manufacture, naming the company Nesselsdorfer Wagenbau-Fabriksgesellschaft, and employed Hugo Fischer von Roslerstam as technical director in 1890. After the death of Šustala, von Roslerstam took over running the company and in 1897 he bought a Benz automobile. Using this for inspiration the company made its first car, the Präsident, which was exhibited in 1897 in Vienna. Orders were obtained for more cars and under the direction of a new young engineer Hans Ledwinka (1878-1967) ten improved cars were made.
The first car to be totally designed by Ledwinka came in 1900 with the Type A with rear mounted 2714cc engine and top speed of 40kilometres per hour (25mph), 22 were made. This was followed by the Type B with central engine in 1902 but then Ledwinka left the company to concentrate on steam engine development. He returned in 1905 and designed a completely new car, the Type S with 3308cc 4 cylinder engine. Production was badly hit in 1912 with a 23-week strike and Hugo Fischer von Roslerstam left the company.
After the World War I Nesselsdorfer Wagenbau was renamed Kopřivnice vozovka, and in 1919 the name Tatra was given to the car range. Leopold Pasching took over control and in 1921 Hans Ledwinka returned again to develop the revolutionary Tatra 11.
The new car, launched in 1923 featured a rigid backbone tube with swinging semi-axles at the rear giving independent suspension. The engine, front mounted, was an air cooled two cylinder unit of 1056cc. The T 11 was replaced in 1926 by the similar T 12 which had four wheel brakes. A further development was the 1926 T 17 with a 1,930cc water-cooled six- cylinder engine and fully independent suspension. In 1927 the company was formally renamed Tatra a.s..
Tatra's specialty was luxury cars of a technically advanced nature, going from aircooled flat-twins to fours and sixes, culminating (briefly) with the OHC 6 litre V12 in 1931. In the 1930s, under Austrian engineer Hans Ledwinka and his son Erich, and protected by a high tariff and absence of foreign assemblers, Tatra then began building advanced, streamlined cars, which started in 1934 with the large Tatra T77, the world's first production aerodynamic car. The fastback T77's drag coefficient of 0.212 is rarely bettered even by the sleekest of modern cars. It featured (as did almost all subsequent big Tatras) a rear-mounted, air-cooled V8 engine, which was in technical terms very sophisticated for the time.