The site was previously occupied by a mansion known as Alder Hey which the local poor law guardians acquired for use as a children's home in 1910.

[5] In 1999 an inquiry was instituted into the Alder Hey organs scandal and to investigate the hospital's practices in respect of removal and retention of human tissue.

[9] The inquiry had far-reaching effects throughout the UK hospital system and provided the impetus for the Human Tissue Act 2004.

[13] At the end of March 2017, the trust was confirmed as one of four additional NHS Global Digital Exemplars, joining the twelve announced in September 2016.

It was also the first UK Centre of Excellence for Childhood Lupus and is:[21] Alder Hey has Europe's first 3T Intraoperative MRI scanner which is a pioneering technology for neurosurgery, providing surgeons with extremely high resolution images and reducing the need for repeat operations in 90% of cases.

The hospital is within the National Institute for Health and Care Research's Top 100 Performing Trust's for participation recruitment in 2013/14.

In addition to NHS funding which covers the running costs of the hospital, Alder Hey relies on charitable support.

[36] Alder Hey has numerous notable supporters, including Yoko Ono as Honorary Patron, Steven Gerrard as Appeal Founding Partner and Patrons including:[37] In 2009 charitable support allowed Alder Hey to buy Europe's first 3T intraoperative MRI scanner.

[39][40] In 1978, the charity Art For Their Sake, a team of volunteer artists led by founder George Nicholas (now of Ormskirk, England), produced the world's longest mural in the corridors of Alder Hey Children's Hospital.

Nicholas and his team continued to work on these murals for a period of 30 years, adding to as well as restoring and maintaining, for a total of over 34,000 square feet.

The programme aims to enhance the experience of being a patient and includes animation projects, music and dance therapy, creative writing, comedy workshops and storytelling.

[55] On 26 January 2023, the Alder Hey Children's Hospital NHS Foundation Trust was granted the Honorary Freedom of the Metropolitan Borough of Sefton.