The first AIIMS was established in 1956 under the All India Institute of Medical Sciences Act, 1956. Originally proposed by the then Prime Minister of India Jawaharlal Nehru for establishment in Calcutta, it was established in New Delhi following the refusal of Chief Minister of West Bengal Bidhan Chandra Roy. The act established AIIMS New Delhi, which was then known simply as All India Institute of Medical Sciences, and gave it the Institutes of National Importance (INI) status. Amrit Kaur was India’s first health minister. When the issue of funds for the setup of AIIMS, New Delhi initially came up, it was she who was instrumental in acquiring a huge amount from the New Zealand government. Over the years, she rallied around and was successful in getting donations from international bodies like the Rockefeller Foundation, and the Ford Foundation, as well as from the government of Australia, West Germany and the Dutch government.

In 2003, the Government of India announced the Pradhan Mantri Swasthya Suraksha Yojana (PMSSY) initiative which aimed at “correcting regional imbalances in the availability of affordable/reliable tertiary healthcare services. This was to be done through two main channels: setting up AIIMS-like institutions and upgrading government medical colleges. Though the announcement was made in 2003 during Atal Bihari Vajpayee’s tenure, the project was delayed owing to the power shift at the centre. PMSSY was officially launched in March 2006 and six AIIMS-like medical institutes were announced. The six institutes become operational through an Ordinance from September 2012. The All India Institute of Medical Sciences (Amendment) Bill, 2012 was introduced in the Lok Sabha on 27 August 2012 in order to replace that Ordinance. Lok Sabha passed the Bill on 30 August 2012, it was introduced in Rajya Sabha on 3 September 2012 and passed on 4 September 2012. The Act was published on 13 September 2012.

The act also allowed the institutes to operate more autonomously, and awarded them the INI status. In addition, also conferred the power to establish other AIIMS-like institutes by gazette notification and give them equal status.