The following text was written by Dennis Ritchie about the early development of Unix at Bell Labs
Also during 1969, Thompson developed the game of `Space Travel.' First written on Multics, then transliterated into Fortran for GECOS (the operating system for the GE, later Honeywell, 635), it was nothing less than a simulation of the movement of the major bodies of the Solar System, with the player guiding a ship here and there, observing the scenery, and attempting to land on the various planets and moons. The GECOS version was unsatisfactory in two important respects: first, the display of the state of the game was jerky and hard to control because one had to type commands at it, and second, a game cost about $75 for CPU time on the big computer. It did not take long, therefore, for Thompson to find a little-used PDP-7 computer with an excellent display processor; the whole system was used as a Graphic-II terminal. He and I rewrote Space Travel to run on this machine. The undertaking was more ambitious than it might seem; because we disdained all existing software, we had to write a floating-point arithmetic package, the pointwise specification of the graphic characters for the display, and a debugging subsystem that continuously displayed the contents of typed-in locations in a corner of the screen. All this was written in assembly language for a cross-assembler that ran under GECOS and produced paper tapes to be carried to the PDP-7.
Space Travel, though it made a very attractive game, served mainly as an introduction to the clumsy technology of preparing programs for the PDP-7. Soon Thompson began implementing the paper file system (perhaps `chalk file system' would be more accurate) that had been designed earlier. A file system without a way to exercise it is a sterile proposition, so he proceeded to flesh it out with the other requirements for a working operating system, in particular the notion of processes. Then came a small set of user-level utilities: the means to copy, print, delete, and edit files, and of course a simple command interpreter (shell). Up to this time all the programs were written using GECOS and files were transferred to the PDP-7 on paper tape; but once an assembler was completed the system was able to support itself. Although it was not until well into 1970 that Brian Kernighan suggested the name `Unix,' in a somewhat treacherous pun on `Multics,' the operating system we know today was born.