The party was founded around Jóhanna Sigurðardóttir, future Prime Minister of Iceland.

[3] The party was formed in 1994 in preparation for the 1995 parliamentary election; one of the co-founders was Jóhanna Sigurðardóttir after she lost an internal election for the leadership of the Social Democratic Party.

In the 1995 parliamentary elections, the party won 7.2% of the vote and four seats.

[3] On 2 October 1996, its members of parliament joined the Social Democratic Party to form a unified parliamentary group.

For the 1999 parliamentary elections it formed the United Front electoral alliance with the Social Democratic Party and the People's Alliance and the Women's List, winning 30% of the vote and 20 seats.