The Institute formed out of the ashes of what was once known as the Institute of Technology. While the college itself was completely destroyed in the flames of the Great War in 2077, the science staff took refuge in the underground vault below the Institute and carved out a subterranean habitat for themselves. The Institute was formally founded in 2110, as the children of the original survivors dug into the earth and built increasingly sophisticated habitats and laboratories, starting an ongoing process of expanding the Institute's facilities and infrastructure.

Isolated from the outside world, the scientists continued their work, disregarding the mayhem and destruction occurring outside of its grounds. As they worked on creating synths, they attempted to work peacefully with the people of the wasteland using first generation synths, but mutual mistrust ended that relationship quickly and they returned to isolation. Eventually, the scientists have utterly put ubiquitous pre-War technology to shame, to the point where they believed that wastelanders would be unlikely to understand the sheer scope of the Institute's achievement, such as the creation of the molecular relay (teleporter) in the 2180s, which resulted in the Institute sealing itself off from the surface permanently, and the development of synths. For decades, the first and second generation synths were the most visible part of the Institute's operations, scavenging for materials and performing experiments on the wasteland. The scientists, sealed away in their utopian society, did not concern themselves with the plight of the surface or the effect their actions had.

However, the Institute eventually reached the limits of the synth technology that underpinned their society. Although powerful, the second generation synth was an inherently limited, mechanical platform. To overcome the limitations of metal synthetic materials, the Institute endeavoured to create synthetic flesh, with the first research initiative beginning in in 2178. Under the auspices of Doctor Frederick, FEV samples served as the starting point for the new, organic synthetic program despite the objections of some members of BioScience. Both women and men were abducted from the Commonwealth and submerged in the Institute's modified FEV, their mutations carefully tracked and extensively investigated. Successful mutations would be monitored to ensure survivability, then tagged and discarded. Research ground to a halt in March 2224, as the research team concluded that the organic synth project could not proceed despite perfecting two FEV strains for the project. Radiation-induced hereditary damage proved too much of an obstacle. The solution came in 2227, with to the acquisition of cryogenically frozen survivor found sealed within an unopened vault, thanks to the undamaged pre-War genetic code. The organic synth project was spun off from the FEV research initiative, and his DNA became the basis of the third-generation synths.