Fred and August Duesenberg began designing engines in the early 1900s after Fred became involved in bicycle racing. The brothers formed the Mason Motor Car Company in 1906 with backing from lawyer Edward Mason in Des Moines, Iowa, a venture that the Maytag family later acquired before selling their stake in 1912. The Duesenbergs then moved to Saint Paul, Minnesota, establishing the Duesenberg Motors Company in 1913. Eddie Rickenbacker drove the first Duesenberg-designed vehicle at the Indianapolis 500 in 1914, placing tenth. During the First World War the brothers designed and built aircraft engines in Elizabeth, New Jersey, and a Duesenberg driven by Tommy Milton won the 1919 Elgin Trophy.
In 1920 they relocated to Indianapolis, where the Duesenberg Automobile and Motors Company was formally established and began manufacturing the Model A road car.
Duesenberg's competition achievements in the 1920s were formidable. A Duesenberg driven by Jimmy Murphy won the 1921 French Grand Prix at Le Mans, becoming the first American car to win a European Grand Prix. At Indianapolis, Duesenberg cars won the 500 in 1922 — when eight of the top ten finishers were Duesenbergs — and again in 1924, 1925 and 1927. The company also popularised the straight-eight engine and pioneered the use of four-wheel hydraulic brakes, both of which had lasting influence on road car design.
The company entered financial difficulty and went into receivership in 1924. Errett Lobban Cord, a transportation executive who already controlled Auburn, purchased Duesenberg in 1926. After Cord's takeover, August Duesenberg concentrated on the racing division, designing all Duesenberg race cars built from 1926 until the company's closure.
Under Cord's direction, Fred Duesenberg was instructed to create a car that would "outclass" every other American automobile. The result was the Model J, first delivered to customers in 1929. Its 7-litre straight-eight engine was derived from the company's racing units and produced 265 horsepower through dual overhead camshafts and four valves per cylinder, making it the most powerful car of its era. The Model J was capable of 116 mph and could reach 88 mph in second gear. The chassis and powertrain were sold without bodywork; the coachwork was custom-built by specialist firms around the world, including Gurney Nutting, Murphy and Derham, with chief body designer Gordon Buehrig responsible for approximately half the bodies.
The supercharged variant, the SJ, was reported to reach 104 mph in second gear and offered a top speed of 135 to 140 mph. Just 36 SJs were built. A special SJ variant known as the Mormon Meteor broke several land speed records. Two shortened SSJ models were produced in 1935 for actors Gary Cooper and Clark Gable; Cooper's SSJ sold at auction in 2018 for 22 million dollars, making it the most expensive American car ever sold at auction at the time. Prices for standard Model Js ranged from $14,000 to $20,000 at a time when most cars cost a small fraction of that sum.
Historian Donald Davidson described Duesenberg as the most prestigious passenger car in American history and likened it to an American equivalent of the Rolls-Royce. The vehicles were popular with film stars, royalty and wealthy industrialists. About 481 Model Js were built in total, and approximately 378 were known to survive as of 2002.
The company was sold by Cord and dissolved in 1937. The final Duesenberg to be completed by the original company was finished in 1940, commissioned by German artist Rudolf Bauer and assembled by August Duesenberg after the firm had formally closed. August attempted unsuccessfully to restart the company in 1947. A later attempt by his son Fritz and car designer Virgil Exner to revive the brand resulted in a single concept car in 1966 but went no further. In 1970 Bernard Miller bought the Duesenberg Corporation and produced eight SSJ-style cars between 1970 and 1974. In 1978, Elite Heritage Motors began producing a handmade Duesenberg II in Elroy, Wisconsin, drawing on original examples as templates, building 67 cars before closing in 2001.
Duesenberg's technical contributions — the straight-eight engine, hydraulic four-wheel brakes, and high-output racing power units — influenced American automobile engineering throughout the interwar period. Its racing record at Indianapolis and in European Grand Prix events demonstrated American engineering capability at a moment when the country had limited presence at international motorsport's highest levels. The name became synonymous in American culture with the pinnacle of automotive luxury, reflected in the slang expression "it's a Doozy" as a synonym for something outstanding.