It was established in July 1976 by a group of renowned Pakistani writers, poets, essayists, playwrights, and translators, inspired by the Académie Française.

It is an autonomous non-profit organisation, supervised by its own board of governors, receiving support from the Government of Pakistan as the apex national institution.

[1] The academy maintains several regional offices, and links with other national and international organizations of a similar status.

A jury comprising Pakistan's eminent literary figures announces, after careful consideration, the name of the yearly award recipient.

[2][4][5] On 24 September 2003, Pakistan Postal Services issued a commemorative postage stamp on the 25th anniversary of the academy's 'official founding' in 1978.