The airfield at Palam in southwestern Delhi began as a Royal Air Force base during World War II. Civil operations transferred from Safdarjung Airport to Palam in 1962 as Delhi's air traffic outgrew its older home, and the newly opened facility could handle approximately 1,300 passengers per hour.

The name changed in 1986. On May 2 of that year, a new international terminal, Terminal 2, opened at a cost of ₹95 crore, offering nearly 4 times the area of the old Palam terminal. With that inauguration, the airport was officially renamed Indira Gandhi International Airport, honoring India's former prime minister. Management passed to the private GMR-led consortium Delhi International Airport Limited (DIAL) in 2006, triggering a reconstruction program that culminated in the opening of Terminal 3 in 2010, built in part to support the Commonwealth Games hosted in Delhi that year. Upon completion, Terminal 3 was the world's 8th-largest passenger terminal, with capacity for 34 million passengers annually. A new 4,430-metre runway had already opened in 2008, and in July 2023 the airport added a second long runway and dual parallel eastern cross taxiways.

Today DEL ranks among the top 10 busiest airports on earth, handling over 79 million passengers in fiscal year 2024-25, a record for the airport. It is a hub for Air India and an operating base for IndiGo and SpiceJet, with roughly 70 airlines connecting it to destinations across Asia, Europe, the Middle East, and beyond. The airport's runways include CAT III-B instrument landing systems, allowing operations in visibility as low as 50 metres, a practical necessity for Delhi's winter fog season.