The basic difference between the Sequential and the Vanity Call Sign System is that instead of the FCC assigning a station call sign from a no choice alphabetized list, the call sign is selected from a list of up to 25 call signs submitted by the licensee. The first vanity call sign was issued in May 1996.

Vanity call signs got their start in 1993 as part of President Clinton's much publicized Deficit Reduction Plan.In it was a provision for the FCC to collect a $7 annual fee to bankroll the administrative cost of providing an amateur call sign chosen by the user. This fee was later reduced to $30.00 for a ten year term to reflect the actual cost of issuing the call sign. The fee is changed annually and the current vanity call sign regulatory fee is $12.00.

The Vanity Call Sign System was adopted primarily due to the efforts of a single amateur, Jim Wills, N5HCT of Tyler, Texas who wanted his previous WA5EHQ station call sign back. He convinced Congress that amateur radio operators would be willing to pay for a specific call sign and they added it to the legislation.

The FCC released the final vanity call sign rules in 1995 wh1ch are embodied in Part 97. (See Sec. 97.19.) The vanity call sign system was implemented in five phases or "starting gates." The FCC has an online information bulletin entitled the Amateur Vanity Call Sign System on their Web site.