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Because new features and techniques appeared regularly on the Macintosh platform, the shareware utility Compact Pro emerged as a competitor to StuffIt in the early 1990s.

StuffIt was upgraded several times, and Lau removed himself from direct development as major upgrades to the 'internal machinery' were rare. Deluxe added a variety of additional functions, including additional compression methods and integration into the Mac Finder to allow files to be compressed from a 'Magic Menu', or seamlessly browse inside and edit compressed files without expanding them using 'True Finder Integration'.

They split the product line in two, offering StuffIt Classic in shareware and StuffIt Deluxe as a commercial package. StuffIt soon became very popular and Aladdin Systems was formed to market it (the last shareware release by Lau was version 1.5.1). By the fall of 1987 StuffIt had largely replaced PackIt in the Mac world, with many software sites even going so far as to convert existing PackIt archives to save more space. Compared to existing utilities on the Mac, notably PackIt, StuffIt offered 'one step' operation and higher compression ratios. It combined the fork-combining capabilities of utilities such as MacBinary with newer compression algorithms similar to those used in ZIP. StuffIt was originally developed in the summer of 1987 by Raymond Lau, who was then a student at Stuyvesant High School in New York City. Raymond Lau (creator), currently Smith Micro SIT!, SITD, SIT2, SIT5 (depending on file version)

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