The E body program was initiated shortly after the Barracuda's introduction, in about 1965. I think Brownlie did the first clay for the new project in 1966-67. It was slated to be on the smaller platform, along the lines of the camaro/mustang. The largest engine was intended to be the 383, largely due to Bunkie Knudsen's 400 cubic inch ban on the small and intermediate platforms. Carl Cameron, Bill Brownlie and the rest of the gang at the Styling Department had some drafts drawn up by 1967 (see my avatar pic, that is a 1967 draft).
By 1968, they had chassis mules based on the B-body platform. They did that for corporate standardization, and after trying to shoehorn the R/B 383 in to the A bodies, and rumors of that 400 cubic-inch ban being lifted, the idea to utilize the B-body cowl, suspension and various other bits seemed natural. Interestingly enough, even after the b-body derived mules were being tested, the 383 was still going to be the biggest motor. A change of heart across town regarding an engine size ban made it really easy to put the big motors in that engine bay.
The challenger's first day of production was Friday August 1, 1969. The pilot, press and show cars were assembled that day. The first Hemi Challenger off the line (Challenger #27 off Line 1) became the Diamante show car.