This paper presents the first use of a Rotary Steerable System (RSS) using air as the drilling fluid. The case history is in an ongoing unconventional gas development in the Appalachian Basin of the northeast United States. The RSS has been integral to increasing lateral lengths and corresponding increases in production while reducing development costs. Since 2006, EQT Production has developed Devonian reservoirs in Kentucky, Virginia and West Virginia using underbalanced, horizontal drilling techniques. The low (200-500 psi) bottom hole reservoir pressure does not allow drilling with fluid. Typical horizontal wells have had 3,000 ft laterals drilled with air, positive displacement motors, and electromagnetic telemetry (EM) MWD systems; that remains the predominate drilling technique. The air compatible RSS was employed to increase lateral length and production. Well 568478, in Letcher County, Kentucky became the first well to have a horizontal section drilled underbalanced using RSS with dry air. To date, eight wells have been drilled with lateral lengths from 3,800 -6,000 ft. Preliminary results show that the reserves developed are proportional to the lateral length drilled. The rates of penetration (ROP) with the RSS in the additional footage were similar to or greater than those in shorter laterals drilled with a motor. The RSS, with an integral EM MWD, has proven to be a technically feasible option in air drilling environments. The comparable ROP and resulting lower lateral costs per foot achieved with the RSS allows drilling horizontal wells with air beyond their previous limits, enabling greater production footage from fewer wellbores. It further allows drilling portions of the reservoir previously unreachable due to surface constraints such as topography. Many of the learnings to implement the RSS technology also applied to the use of the positive displacement motors (PDMs) previously used. These learnings were applied to the motors and significant improvements were made in drilling horizontals with these tools. Motor capability was pushed beyond limits previously established in the areas being drilled. As a result of the success with RSS and PDMs on extended laterals, EQT Production is extending the lateral length from 3,000 ft to 5,500 -7,000 ft on a plurality of the future wells drilled in the Devonian section.