Michael Dell founded Dell Computer Corporation, doing business as PC's Limited in 1984 while a student at the University of Texas at Austin,[15] operating from Michael Dell's off-campus dormitory room at Dobie Center.[16] The start-up aimed to sell IBM PC compatible computers built from stock components. Michael Dell started trading in the belief that, by selling personal computer systems directly to customers, PC's Limited could better understand customers' needs and provide the most effective computing services to meet those needs.[17] Dell dropped out of college upon completion of his freshman year at the University of Texas in order to focus full-time on his fledgling business, after getting about $1,000 in expansion-capital from his family.[18] As of April 2021, Dell's net worth was estimated to be over $50 billion (equivalent to $55,470,000,000 in 2023).[19]

In 1985, PC's Limited launched its first computer, the "Turbo PC," priced at US$795 (equivalent to $1,913 in 2023).[20] The Turbo PC featured an Intel 8088-compatible processor with a maximum speed of 8 MHz.[21] PC's Limited marketed these systems through national computer magazines, selling directly to consumers while custom-assembling each unit based on a range of options. This approach allowed them to offer competitive prices compared to retail brands, coupled with the convenience of pre-assembled units, making them one of the early success stories of this business model. The company grossed over $73 million in its first year of operation. The company dropped the PC's Limited name in 1987 to become Dell Computer Corporation and began expanding globally. The reasoning was that this new company name better reflected its presence in the business market, and also resolved issues with the use of "Limited" in a company name in certain countries.[22] The company set up its first international operations in Britain; 11 more followed within the next four years. In June 1988, Dell Computer's market capitalization grew by $30 million to $80 million (equivalent to $177,850,000 in 2023) from its June 22 initial public offering of 3.5 million shares at $8.50 a share.[23] In 1989, Dell Computer set up its first on-site service programs in order to compensate for the lack of local retailers prepared to act as service centers.