For the last four decades Unmanned Air Vehicles (UAVs) have been extensively used for military operations that include tracking, surveillance, active engagement with weapons and airborne data acquisition. UAVs are also in demand commercially due to their advantages in comparison to manned vehicles. These advantages include lower manufacturing and operating costs, flexibility in configuration depending on customer request and not risking the pilot on demanding missions. Even though civilian UAVs currently constitute 3 % of the UAV market, it is estimated that their numbers will reach up to 10 % of the UAV market within the next 5 years. Most of the civilian UAV applications require UAVs that are capable of doing a wide range of different and complementary operations within a composite mission. These operations include taking off and landing from limited runway space, while traversing the operation region in considerable cruise speed for mobile tracking applications. This is in addition to being able traverse in low cruise speeds or being able to hover for stationary measurement and tracking. All of these complementary and but different operational capabilities point to a hybrid unmanned vehicle concept, namely the Vertical Take-Off and Landing (VTOL) UAVs. In addition, the desired UAV system needs to be cost-efficient while providing easy payload conversion for different civilian applications. In this paper, we review the preliminary design process of such a capable civilian UAV system, namely the TURAC VTOL UAV. TURAC UAV is aimed to have both vertical take-off and landing and Conventional Takeoff and Landing (CTOL) capability. TURAC interchangeable payload pod and detachable wing (with potential different size variants) provides capability to perform different mission types, including long endurance and high cruise speed operations. In addition, the TURAC concept is to have two different variants. The TURAC A variant is an eco-friendly and low-noise fully electrical platform which includes 2 tilt electric motors in the front, and a fixed electric motor and ducted fan in the rear, where as the TURAC B variant is envisioned to use high energy density fuel cells for extended hovering time. In this paper, we provide the TURAC UAV's iterative design and trade-off studies which also include detailed aerodynamic and structural configuration analysis. For the aerodynamic analysis, an in-house software including graphical user interface has been developed to calculate the aerodynamic forces and moments by using the Vortex Lattice Method (VLM). Computational Fluid Dynamics (CFD) studies are performed to determine the aerodynamic effects for various configurations For structural analysis, a Finite Element Model (FEM) of the TURAC has been prepared and its modal analysis is carried out. Maximum displacements and maximal principal stresses are calculated and used for streamlining a weight efficient fuselage design. Prototypes have been built to show success of the design at both hover and forward flight regime. In this paper, we also provide the flight management and autopilot architecture of the TURAC. The testing of the controller performance has been initiated with the prototype of TURAC. Current work focuses on the building of the full fight test prototype of the TURAC UAV and aerodynamic modeling of the transition flight.