Two veterinary scientists, Barry Scott and Steve Brown, registered Australian Koala Association Inc in 1986, and subsequently changed the name to Australian Koala Foundation Inc. The term "Inc" was later dropped. Chief Executive Officer, Deborah Tabart OAM, has headed the Foundation for over 20 years, earning the international title of the Koala Woman.

In 1980s, it was believed that the major threat to koalas was a disease known as chlamydia. The initial goal of the AKF was to find a cure for chlamydia. It was soon discovered that habitat destruction was the main cause of the koalas'' problems. The focus of the AKF was adjusted accordingly.

Today, the Australian Koala Foundation use science, politics and a global support base to rally for change at the legislative, developmental and personal level. September is Save the Koala Month which is the primary time of year that the Australian Koala Foundation work to raise awareness and funds for the plight of the koala. With only around 100 000 koalas left in the wild and local extinctions occurring regularly, the fight to protect habitat and manage koala populations remain the goals of the Foundation.