The airline was established and started operations in 1949. It began in Tamworth as a one-aircraft, one-pilot operation, known as Tamworth Air Taxi Service (soon after to be shortened to Tamair), serving farming communities in New South Wales and Queensland. After 36 years of expansion and amalgamation with several smaller commuter operators, the current name was adopted in 1986. Australian Airlines purchased 26% of Eastern Australian Airlines from East-West Airlines in 1988, and the airline became a wholly owned subsidiary in 1991. Qantas purchased Australian Airlines in 1992.