The Mahatma Gandhi Institute was set up by an Act of Parliament which was passed on 23 December 1970 as a joint initiative of the Governments of India and Mauritius. On 03 June 1970, the foundation stone was laid by Shrimati Indira Gandhi, Prime Minister of India. The Mahatma Gandhi Institute was inaugurated on 09 October 1976 by two distinguished personalities, Dr the Right Hon. Sir Seewoosagur Ramgoolam, Prime Minister of Mauritius, and Shrimati Indira Gandhi, Prime Minister of India.

The Mahatma Gandhi Institute Act 1982 together with the Mahatma Gandhi Institute (Amendment) Act 2002 and the Rabindranath Tagore Institute Act 2002 have provided for the Mahatma Gandhi Institute and the Rabindranath Tagore Institute (located in an idyllic setting at Ilot in the northern part of the country) to function under one Council and one Director-General. By broadening its scope, the Mahatma Gandhi Institute is well settled on its path to cater for the growing educational, academic, and cultural demands of the country and to contribute to the regional role of Mauritius.

The Mahatma Gandhi Institute is today rightly viewed as a meeting ground for different cultures. The philosophy underlying the vision and the mission of the Mahatma Gandhi Institute takes example from Gandhian thought, rich in educational and social values.