The institution was founded on March 4, 1902 by Swami Shraddhanand (1856–1926), a member of the Arya Samaj, with the aim of reviving the ancient Hindu educational system of residential schools or gurukuls imparting esoteric knowledge under the direct guidance of a guru or adept as an alternative to the Western-oriented system of Education imposed on India by Lord Macaulay. The impetus for the foundation was found in the teachings and activities of Dayananda Saraswati, founder of the Arya Samaj. The original campus, at Kangri village, Bijnor district, was flooded when the river changed course in 1924, the new (present) campus was built subsequently.
