The RBMK was the culmination of the Soviet program to produce a water-cooled power reactor based on their graphite-moderated plutonium production reactors. The first of these, AM-1 (for Atom Mirny, Russian for "peaceful atom") was designed to produce 5MWe (30MW thermal) and delivered power to Obninsk from 1954 until 1959.
Using light water for cooling and graphite for moderation, it is possible to use natural uranium for fuel. Thus, a large power reactor can be built that requires no separated isotopes, such as enriched uranium or heavy water, and the RBMK remains the only large power reactor yet built without needing these expensive materials. But unfortunately, such a configuration is also unstable.
Ordinary (light) water absorbs neutrons fairly readily, and so removing water from the core (such as happens when it boils and is replaced by steam) tends to increase the rate at which the nuclear reaction proceeds. In a water-moderated reactor, this effect is countered by the reduction in moderation, but in the RBMK the moderating effect of the water is small compared to that of the graphite, so the overall effect is positive. This is called a "positive void coefficient". The RBMK as designed also had a "positive power coefficient", meaning that an increase in reactor power tends to further increase the rate of reaction. Large positive void and power coefficients can produce runaway conditions and have not been permitted in other reactor designs, but it was not possible to eliminate them from the RBMK if natural uranium fuel was to be used.
The RBMK was also intended to use recycled uranium from reprocessed PWR fuel, which has a low remaining enrichment. In this configuration it was also unstable. These characteristics brought the RBMK to the world's notice in 1986, when one of the four RBMK reactors at Chernobyl exploded in the worst civilian nuclear accident to date.
Since that accident, remaining RBMKs have been operated with a reduced number of fuel elements containing more highly enriched fuel, enabling them to operate relatively safely but defeating the original concept. Control systems have also been improved, in particular to eliminate the graphite tips on the control rods which produced an immediate increase in power when the rods were first inserted. This design feature is blamed for triggering the first actual explosion when the emergency shutdown button was pressed in an attempt to shut down the already out of control reactor during the Chernobyl disaster.