Instituted in 1996 by Lieutenant Governor Gilbert Clements, on the advice of the Cabinet under Premier Catherine Callbeck,[1] the order is administered by the Governor-in-Council and is intended to honour current or former Prince Edward Island residents for conspicuous achievements in any field,[1][2] being thus described as the highest honour amongst all others conferred by the Prince Edward Island Crown.

"[2] Although Canadian citizenship is not a requirement, those who are elected or appointed members of a governmental body are ineligible as long as they hold office,[2] and only three people per year may be inducted into the order.

Posthumous nominations are not accepted, though an individual who dies after his or her name was submitted to the Honours and Advisory Council can still be retroactively made a Member of the Prince Edward Island.

[3] The lieutenant governor, ex officio a Member and the Chancellor of the Order of Prince Edward Island,[3] then makes all appointments into the fellowship's single grade of membership by an Order in Council that bears the viceroyal sign-manual and the Great Seal of the province; thereafter, the new Members are entitled to use the post-nominal letters OPEI.

Members will also receive for wear on casual clothing a lapel pin, appearing as a smaller version of the Medal of Merit.