During the period that the original proposals were being studied, advances in supersonic flight were proceeding rapidly. The narrow delta was establishing itself as a preferred planform for supersonic flight, replacing earlier designs like the swept wing and trapezoidal layouts seen on designs like the Lockheed F-104 Starfighter and the earlier WS-110 concepts. Engines able to cope with higher temperatures and widely varying intake ramp air speeds were also under design, allowing for sustained supersonic speeds.
This work led to an interesting discovery. When an engine was optimized specifically for high speed, it burned perhaps twice as much fuel at that speed than when it was running at subsonic speeds, although the aircraft would be flying as much as four times as fast. Thus its most economical cruise speed, in terms of fuel per mile, was its maximum speed. This was entirely unexpected, and implied that there was no point in the dash concept, that an aircraft able to reach Mach 3 may as well fly its entire mission at that speed. By March 1957, engine development and wind tunnel testing had progressed such that the potential for all-supersonic flight appeared feasible – the cruise-and-dash approach that had resulted in huge designs was no longer needed.
The project decided that the aircraft would fly at speeds up to Mach 3 for the entire mission, instead of a combination of subsonic cruise and supersonic dash of the aircraft designs in the previous year. Zip fuel was to be burned in the engine's afterburner to increase range. Both North American and Boeing returned new designs with very long fuselages and large delta wings. They differed primarily in engine layout; the NAA design arranged its six engines in a semi-circular duct under the rear fuselage, while the Boeing design used separate podded engines located individually on pylons below the wing, like the Hustler.
North American had scoured the literature to find any additional advantage. This led them to an obscure report by two NACA wind tunnel experts, who wrote a report in 1956 entitled "Aircraft Configurations Developing High Lift-Drag Ratios at High Supersonic Speeds". Known today as compression lift, the idea was to use the shock wave generated off the nose or other sharp points on the aircraft as a source of high-pressure air. By carefully positioning the wing in relation to the shock, the shock's high pressure could be captured on the bottom of the wing and generate additional lift. To take maximum advantage of this effect, they redesigned the underside of the aircraft to feature a large triangular intake area far forward of the engines, better positioning the shock in relation to the wing.
North American improved on the basic concept by adding a set of drooping wing tip panels that were lowered at high speed. This helped trap the shock wave under the wing between the downturned wing tips, and also added more vertical surface to the aircraft to improve directional stability at high speeds. NAA's solution had an additional advantage, as it decreased the surface area of the rear of the wing when the panels were moved into their high-speed position. This helped offset the rearward shift of the center of pressure, or "average lift point", with increasing speeds. Under normal conditions this caused an increasing nose-down trim, which had to be offset by moving the control surfaces, increasing drag. When the wing tips were drooped the surface area at the rear of the wings was lowered, moving the lift forward and counteracting this effect, reducing the need for control inputs.
The buildup of heat due to skin friction during sustained supersonic flight had to be addressed. During a Mach 3 cruise, the aircraft would reach an average of 450 °F (230 °C), with leading edges reaching 630 °F (330 °C), and up to 1,000 °F (540 °C) in engine compartments. NAA proposed building their design out of sandwich panels, with each panel consisting of two thin sheets of stainless steel brazed to opposite faces of a honeycomb-shaped foil core. Expensive titanium would be used only in high-temperature areas like the leading edge of the horizontal stabilizer, and the nose. For cooling the interior, the XB-70 pumped fuel en route to the engines through heat exchangers.
On 30 August 1957, the Air Force decided that enough data was available on the NAA and Boeing designs that a competition could begin. On 18 September, the Air Force issued operational requirements which called for a cruising speed of Mach 3.0 to 3.2, an over-target altitude of 70,000–75,000 ft (21,300–22,700 m), a range of up to 10,500 mi (16,900 km), and a gross weight not to exceed 490,000 lb (222,000 kg). The aircraft would have to use the hangars, runways and handling procedures used by the B-52. On 23 December 1957, the North American proposal was declared the winner of the competition, and on 24 January 1958, a contract was issued for Phase 1 development.
In February 1958, the proposed bomber was designated B-70, with the prototypes receiving the "X" experimental prototype designation. The name "Valkyrie" was the winning submission in early 1958, selected from 20,000 entries in a USAF "Name the B-70" contest. The Air Force approved an 18-month program acceleration in March 1958 that rescheduled the first flight to December 1961. But in late 1958 the service announced that this acceleration would not be possible due to lack of funding. In December 1958, a Phase II contract was issued. The mockup of the B-70 was reviewed by the Air Force in March 1959. Provisions for air-to-surface missiles and external fuel tanks were requested afterward. At the same time, North American was developing the F-108 supersonic interceptor. To reduce program costs, the F-108 would share two of the engines, the escape capsule, and some smaller systems with the B-70. In early 1960, North American and the USAF released the first drawing of the XB-70 to the public.