IGIMS was established on 19th November 1983, as an autonomous organisation on the pattern of All India Institute of Medical Sciences, New Delhi. The objective was to provide super specialty medical facilities in Bihar. On 27th January 1983 Cabinet approved the completion of this massive project in 4 phases within a span of six (6) years. According to the decision of State Government, 130.20 Acres of land was transferred to IGIMS. It was proposed that the hospital will be completed by 1990 with a capacity to house 1000 beds. The estimated cost was 110 Crore rupees which was later revised to 133 crores .Because of financial stringency only 4669.30 Lakh could be made available by the State Government.

IGIMS was setup with the following objectives :

To establish an apex centre for delivery of health and medical care of highest standard

To train specialists of high order in different branches of medical services

To improve the health service in the State through appropriate linkage and referral system with Medical Colleges and District and Sub divisional hospitals.

To develop the continued education programme and award degrees and certificates and Post Graduate degrees.

To develop clinical research centre for conducting investigation on the problems of human health and diseases peculiar to and prevent in this part of the country.

To develop Community Health Research Centre to study and find out solutions to the problems of health of the community with particular emphasis on reproductive biology and population control.

To develop research and training in basic sciences relevant to the problems and needs of the Community.

Statistics of All India Institute of Medical Science (AIIMS), Delhi and Post Graduate Institute of Medical Sciences (PGIMS), Chandigarh show the a large number of patients from Bihar State suffering from Heart Diseases, Neurological problems, Cancer , Renal Dialysis, Ophthalmic problems etc go to AIIMS/PGIMS. Getting treatment at AIIMS/PGIMS puts heavy economical burden on them apart from the difficulty of traveling to a distant location and puts excessive loads on those institutions.

Looking into the problem, State Government, in consultation with experts from various parts of country, decided to setup an institute of AIIMS standard so that the patients from Bihar, Sikkim, Nepal, Bhutan etc may get best medicare at the lowest possible expense. To achieve these objectives the institute was established and named after the Former Prime Minister of India, Smt. Indira Gandhi.