As the BMW 801 radial engine used by the Do 217K was in heavy demand for the Fw 190 fighter, the Do 217M, a version powered by the larger displacement Daimler-Benz DB 603 liquid-cooled inverted V12 engine, was developed in parallel with the 217K. It shared the new forward fuselage of the 217K, with the first prototype flying on 16 June 1942. According to RLM plans, production of the M model, which was powered by DB 603 A-1s was due to commence with two aircraft in May 1942 and 10 M-1s in the summer. By March 1943 a production target of 42 aircraft per month was to be achieved. The DB 603 A-3 was chosen as the increased performance handed the aircraft improved characteristics. However, it had not been fully tested and a number of technical problems arose. A Do 217H (a glider-bomber for land operations with E-2 airframe) would be used for endurance testing. This would provide useful testing evaluations for the M-1.

The M V1 was to be the first prototype. It was a E-2 conversion with altered cockpit and DB 603 engines. It operated from the central Luftwaffe Erprobungstelle aircraft test center at Rechlin from September 1942. During the winter the prototype performed long-range and high altitude flights. On 16 November it was forced landed for unstated reasons. Different engine-cooling systems were tried and flame retarders added. Although the addition of the dampers caused a reduction in speed of 15 to 25 kph depending on altitude. The first production prototype series M-0 aircraft (M-01) crashed in Lake Möritz, near the location of the Rechlin test base, on 9 September 1942 while on an engine test. The M-02 was given wing reduction to 59 m2, which became the predecessor of the M-3. The M-03 refined the design with DB 603 A-1 engines but crashed after a mid-air collision with a Dornier Do 215 on 14 May 1943. Six 0-series aircraft (Wrk Nr. 1241 to 1245) were manufactured. Rechlin log books in cluded frequent references to a M-04 from December 1942 to May 1943. This aircraft was apparently used for de-icing and cabin heating tests as well as high-altitude testing with DB603s. Some M-0s were used to evaluate performance with glide bombs (Wrk Nr. 1244 and 1245). These aircraft were named M-0/U1. Each had an ETC 2000 XII, under the fuselage.

Sources:
Gunston, Bill - The Encyclodepia of the Worlds Combat aircraft, 1976, Chartwell Books, Inc., New York
Brown, Eric, Captain - Wings of the Luftwaffe, 1979, Airlife Publishing Ltd., Shrewsbury
Gunston, Bill & Wood, Tony - Hitler's Luftwaffe, 1977, Salamander Books Ltd., London
Donald, David - The Complete Encyclopedia Of World Aircraft, 1997, Brown Packaging Books Ltd., London
Wikipedia - Dornier Do 217