Air Malawi frequently had financial difficulties, and the Malawian government attempted to privatise the airline on two occasions without success.

The first attempt in 2003 failed because the successful bidder, in partnership with South African Airways, was unable to post a security bond.

CAA supplied Air Malawi with two Douglas DC-3s and three de Havilland Canada DHC-2 Beavers to begin services, and also provided technical assistant, equipment and personnel.

British Caledonian sold the aircraft to Air Malawi in November 1974, and the service to Gatwick Airport in London, via Nairobi, began on 3 December 1974.

By the end of 1975, the airline operated one VC-10, two One-Elevens, two HS-748s and two Islanders, on a route network which included Amsterdam, Beira, Harare, Johannesburg, Lusaka, Manzini, Ndola, Nairobi, Salisbury and Seychelles.

[5] In September 1978, the VC-10 was withdrawn from service, because of increasing operational costs which were a burden on the airline's financial stability, and the two Viscounts were sold to Air Zimbabwe in 1979 and 1980.

[5] In April 1985, the airline wet leased a Boeing 747SP from South African Airways and painted the aircraft in Air Malawi livery.

[5] On 6 November 1987, a Shorts Skyvan was shot down by Mozambican armed forces killing all 10 people (8 passengers and 2 crew) on board.

[5] In April 2000, it was reported that Air Malawi was in financial difficulty, and that it may have had to sell assets in order to stay afloat, however the airline public relations department refused to comment on the situation.

[9] 110 employees were laid off in March 2002 in order to help keep costs under control, with Mathews Chikaonda, the former Malawian Finance Minister noting that the airline was overstaffed and was a drain on the coffers of the government.

[11][12] In November 2007, it was announced that the Malawian government was in talks with Comair of South Africa over a partnership deal with Air Malawi.

[17] In October 2009, Air Malawi started an e-commerce project to cut down costs and provide realtime access to reservations for online customers and travel agents.