The party was registered on October 25, 2002[1] and its founding convention was held for two days beginning on February 14, 2003, in Red Deer, Alberta.

The Alliance gained its first Member of the Legislative Assembly of Alberta (MLA) on June 29, 2004, when Gary Masyk crossed the floor, quitting the Progressive Conservative Party to protest Ralph Klein's handling of health care issues during the 2004 federal election.

[citation needed] The Alliance leadership defended its use of American strategists, claiming that most right-leaning Albertan consultants were already hired by the well-heeled Tories.

Part of the promotional package used by the party was bumper stickers a variety of fliers for different problems and a television ad, as well as T-shirts and a website.

"I Blame Ralph" received significant attention, but did not include any of the standard Alberta Alliance logos or colours, instead using red and white leading many to believe the Liberals were responsible.

The party's lone incumbent MLA, Gary Masyk, was defeated running for re-election in the new electoral district of Edmonton Decore, placing a distant fourth.

The Alliance appears to have played spoiler in some urban seats, siphoning off enough votes from the Tories that Liberals or New Democrats were elected.

The party won a narrow victory in the Progressive Conservative stronghold of Cardston-Taber-Warner, where Paul Hinman became the first MLA elected under the Alliance banner, defeating incumbent Broyce Jacobs.

On March 7, 2005, Thorsteinson announced his resignation as leader of the Alberta Alliance, citing that he would not be able to devote the time and energy into the party.

The Alberta Alliance had four candidates were nominated: Paul Hinman was elected as the party's new leader on November 19, 2005, after a bitter leadership campaign.

The basis for such an argument is that both Social Credit and Alberta Alliance would most likely to compete for the "rural vote"- traditionally PC heartland.

The Alberta Alliance began its campaign for the Calgary Elbow and Drumheller-Stettler by-elections at the Annual General Meeting held on March 24, 2007.

When the returns came back on June 12, 2007, Dave France finished a distant fifth place and there was a significant re-alignment of votes among the opposition parties.

In Calgary Elbow the party managed a slight increase in its popular vote percent but failed to make a breakthrough.

After the release of the Oil Royalty Review Panel Final Report,[13] the Alberta Alliance came out strongly in favour of petroleum producers.

The party released a new website called Protect Our Prosperity,[14] which sought to inform Albertans about the possible consequences for oil royalty increases.