It was founded by Dr. José Antonio Arze and other Bolivian intellectuals on 26 July 1940 during a left-wing congress held in Oruro.
The PIR began to organize the country's miners, but it did so cautiously for fear that strikes would hinder supplies for the Allies during World War II.
Except for the pro-Axis Gualberto Villarroel, the PIR generally supported all of Bolivia's war-time presidents to assure the nation remained an Allied power.
In 1950, a section of the PIR membership broke away and founded the Communist Party of Bolivia (PCB).
A reconstituted PIR emerged in the late 1970s as a puppet party of the dictator Hugo Banzer.