The military buildup in the north of Australia in the late 1930s saw the need for an airport that could take larger and heavier aircraft.

This led to the construction of Seven Mile Aerodrome and the diminished role of the Town Site Drome from 1946 until its eventual abandonment in 1968.

The original North South runway was along Memorial Drive, which runs along the front of the Aviation museum, whereas the original East West runway was along the nearby residential street of Van Senden Avenue Seven Mile Aerodrome was originally built in 1940 by the Australian Department of Defence and was used primarily by the Royal Australian Air Force and the United States Air Force, to bring troops and supplies into the area.

The airport became the main transit base for RAAF transport planes during World War II.

On 27 May 2011, it was announced that Alice Springs Airport had been selected to be the first large-scale aircraft boneyard outside the United States.

The facility will store commercial aircraft not in use, as well as those planes that have been decommissioned from service and which will be stripped of parts to be recycled, such as engines, electronics and wiring.

As a result of the COVID-19 pandemic, various overseas airlines including Singapore Airlines, Scoot, NokScoot (now defunct), Fiji Airways, Cebu Pacific, Garuda Indonesia, Cathay Dragon (now defunct) and Cathay Pacific are storing their aircraft in the facility.