From its inception in 1884, a colonial service organization performed administrative functions (policy and management) for the executive arm of the imperial government.

By the law of 18 July 1896 the department further co-supervised the colonial military or protection force, the Schutztruppe, with its headquarters (Kommando der Schutztruppen) formerly billeted in the Imperial Naval Office (Reichsmarineamt).

A decree by Emperor Wilhelm II of 17 May 1907 removed the Colonial Department together with the Schutztruppe command from the Foreign Office and elevated it to a central authority in its own right, the Reichskolonialamt, to be managed by a cabinet-level Secretary of State.

The newly established Reichskolonialamt led by Secretary of State Bernhard Dernburg reported directly to the head of government, the Reich Chancellor.

The new Reichskolonialamt had three departments Abteilungen: The Kolonialrat colonial advisory board was replaced in 1908 (after the major reorganizations of 1907) by a panel of independent experts.