Microsoft purchased a license for UNIX 7th Edition from AT&T in  1979 ,
and announced on August  25 ,  1980  that it would make it available for the  16 -bit microcomputer market.
Xenix was Microsoft's version of UNIX intended for use on microprocessors,
but they called it Xenix because it could not license the "UNIX" name.

Xenix varied from its 7th Edition origins by incorporating elements from BSD,
and soon possessed the most widely installed base of any Unix flavor due to the popularity
of the inexpensive x86 processor, even though the port created for Tandy computers proved to be more robust.

Xenix was not sold directly to end users. Microsoft licensed it to computer manufacturers who then ported it to their systems.
The first ports of Xenix were to the Zilog Z8001 16-bit processor.
Altos shipped a version for their computers early in 1982, Tandy Corporation shipped one for their 68000-based systems
in January 1983, and Santa Cruz Operation (SCO) released their port to the Intel 8086 processor in September 1983.
At the time, Xenix was based on AT&T's UNIX System III.

Version  2 . 0  of Xenix was released in  1985  that was based on UNIX System V.
An update numbered  2 . 1 . 1  added support for the Intel  80286  processor. Subsequent releases improved System V compatibility.

When Microsoft entered into an agreement with IBM to develop OS/ 2 , it lost interest in promoting Xenix.
In  1987  Microsoft transferred ownership of Xenix to SCO in an agreement that left Microsoft owning  25 % of SCO.