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The Raman Research Institute was founded in 1948 by the Indian physicist and Nobel Laureate, Sir C V Raman, to continue his studies and basic research after he retired from the Indian Institute of Science. Sir C V Raman served as its director carrying on his personal research until his demise in 1970. It was funded personally by him and with donations from private sources.

In December 1934, the Government of Mysore gifted a plot of land in Bangalore to Professor Raman for the creation of a research institute. In the same year, the Indian Academy of Sciences was founded by Prof. Raman. Some years following the creation of the Raman Research Institute in 1948, Prof. Raman made a gift of various movable and immovable properties to the Academy for the use and benefit of the Raman Research Institute. After the Professor's demise in November 1970, the Academy created a public charitable trust: the Raman Research Institute Trust. The lands, buildings, deposits, securities, bank deposits, money, laboratories, instruments, and all other movable and immovable properties held by the Academy for the Raman Research Institute were transferred to the RRI Trust. The foremost function of the RRI Trust was to maintain, conduct and sustain the Raman Research Institute.

The Raman Research Institute is now an autonomous research institute engaged in research in basic sciences. In 1972, the RRI was restructured to become an aided autonomous research institute receiving funds from the Department of Science and Technology of the Government of India. A set of Regulations and Bye-Laws were framed for its administration and management. Today, the main areas of research at the Institute are Astronomy & Astrophysics, Light & Matter Physics, Soft Condensed Matter, and Theoretical Physics.