The Air Force Distinguished Service Medal was created by an act of the United States Congress on July 6, 1960. The medal was intended as a new decoration of the United States Air Force to replace the policy of awarding the Army Distinguished Service Medal to Air Force personnel.

The Air Force Distinguished Service Medal is awarded to any member of the United States Air Force who has distinguished himself or herself by exceptionally meritorious service to the United States Government in a duty of great responsibility. The interpretation of the phrase "great responsibility" means that this medal is generally awarded only to officers who hold at least the rank of Major General. However, as is customary for most military decorations, the requirements for the Distinguished Service Medal are interpreted more liberally when awarded upon retirement. As a result, it is the typical decoration for a retiring Brigadier General, and in recent years it has also been awarded to the Chief Master Sergeant of the Air Force upon retirement.