In the late 1980s, the group was weakened by the introduction of new counter-insurgency tactics and the signing of a ceasefire agreement by the KIO 4th Brigade, its long-time ally, who became the Kachin Defence Army and stopped supplying it with weapons.

[6] In reaction, several of its members based at the headquarters of the Karen National Union in Manerplaw, on the Thailand-Myanmar border, decided to reject the decision of their mother organization and on 12 January 1992 formed the Palaung State Liberation Front (PSLF) under the leadership of Mai Tin Moung.

[12] Following the 2021 coup d'état the PSLF/NLA initially avoided conflict with junta troops and took advantage of the drop in fighting to boost its governance capacities in northern Shan State.

[2] In December 2023, the PSLF/NLA took control of the Pa Laung Self-Administered Zone following the capture of the towns of Namhsan and Mantong as part of Operation 1027 during the current Myanmar civil war.

[18][19][20][21] The TNLA claims that they arrest opium smugglers regularly and the narcotics seized are publicly burned on special occasions to deter drug trade.

The group also operates a parallel justice system with dedicated courts and prisons by recruiting civil servants and lawyers who sought refuge in their territory after defecting from the junta.

[5] Another important financing source of the group is the payment of fees by Chinese contractors conducting infrastructure projects in the region in exchange for ensuring their free access and safety.

[26] Since its creation the PSLF/TNLA has been frequently engaged in clashes with local armed militias established by the State Peace and Development Council junta, that are often involved in drug trafficking.

[27] In November 2016, Northen Alliance forces launched coordinated attacks on military targets in northern Shan State and briefly took control of a portion of the Mandalay-Muse Highway.

[29] After joining the Nationwide Ceasefire Agreement in October 2015, the RCSS/Shan State Army-South began expanding its operations towards the China border, thus encroaching on territories controlled by the PSLF/TNLA.

[2] In 2021, the TNLA, in cooperation with the Shan State Progress Party (SSPP), managed to register gains against RCSS troops, forcing them to withdraw south of the Mandalay-Muse Highway before pushing them back to their strongholds near the Thailand-Myanmar border.