The HSLS were established in May 1989 in Zagreb as the first Croatian political party formed after the re-introduction of the multi-party system, at the time when SR Croatia was still part of SFR Yugoslavia.

After losing the 2003 election, in which Budiša's HSLS shunned both the centre-left and centre-right coalitions, the party's decline in political influence started.

In the most recent 2024 election HSLS won two MPs in the 151-seat Sabor, as part of a wider conservative coalition.

On the European level, HSLS are one of several Croatian parties affiliated with ALDE, the main pan-European liberal political group.

However, in November 1997 Budiša became the president again, and a faction led by Gotovac split off to form the Liberal Party.

At the 2003 Croatian parliamentary election, an alliance of the HSLS and the Democratic Centre won 4.0% of the popular vote and 3 out of 151 seats.

For the next election, in November 2015, HSLS was part of the wider conservative-right-wing Patriotic Coalition led by HDZ, and managed to gain two seats in the 8th Assembly, which meant that the party returned to parliament in December 2015, after a five-year absence.

In the next three elections (2016, 2020, 2024) HSLS have been part of coalitions led by the conservative HDZ party and have supported the governments of Prime Ministers Tihomir Orešković and Andrej Plenković, without having members in their cabinets.

[citation needed] Ahead of 2013 constitutional referendum for defining marriage as being a union between a man and a woman, HSLS urged its members and supporters to vote against proposed change.