Subsequent to April 1974 the letter “V” may be authorized by the Navy and Marine Corps.

In a letter from the Secretary of War to the Director, Bureau of Budget, dated 9 March 1942, the Secretary submitted a proposed executive order establishing the Air Medal for award to any person who, while serving in any capacity of the Army of the United States, distinguishes himself by meritorious achievement while participating in an aerial flight The Secretary of War, in his request, stated "The Distinguished Flying Cross is available only for heroism or extraordinary achievement while participating in aerial flight…It is desired not to cheapen the Distinguished Flying Cross by awarding it for achievement not bordering on the heroic. It is, however, important to reward personnel for meritorious service."

The Air Medal was authorized by President Roosevelt by Executive Order 9158, dated 11 May 1942, and established the award for "any person who, while serving in any capacity in the Army, Navy, Marine Corps or Coast Guard of the United States subsequent to September 8, 1939, distinguishes, or has distinguished, himself by meritorious achievement while participating in an aerial flight." Authorization was announced in War Department Bulletin No. 25, dated 25 May 1942. Executive Order 9242-A, dated 11 September 1942 amended the previous Executive Order to read "in any capacity in or with the Army".

Oak leaf clusters were initially used to denote subsequent awards of the Air Medal. The number of additional awards were so great that the oak leaf clusters did not fit on the ribbon. As a result, the policy was changed in September 1968 to require the use of numbers to indicate subsequent awards of the Air Medal.

The Air Medal may be awarded for service during peacetime; however, approval authority for peacetime awards is not delegated to field commanders.