.300 Blackout is derived from the same cartridge case as the .223/5.56mm round commonly used in AR-15 pattern rifles. The case is “necked up” to accept a larger .30 caliber projectile.
It was developed for 2 primary purposes. First, to allow for a .30 caliber round to function in the action of an AR-15 pattern rifle. There is a weight limit to .223/5.56mm projectiles that will fit in an AR-15 magazine. The only way to make a projectile heavier without increasing diameter is to increase its length. Heavier rounds generally provide better penetration. Typical .30’s such as .308 are too long to fit the AR-15 action or magazines. AR pattern rifles in .308(such as the AR-10) are much larger and the magazines hold fewer rounds.
The second reason for its design was to allow the use of heavier .30 caliber projectiles, with less powder charge due to the smaller case than other common .30’s, and reduce velocity to sub-sonic levels. This eliminates the “sonic boom” generated by high velocity rifle rounds. A suppressor can eliminate the muzzle blast of a round, but not the “sonic boom”.