The minor district (King Amphoe) was created on May 5 1981, when the three tambon Mae Pao, Mae Tam and Mai Ya were split off from Thoeng district. It was upgraded to a full district on August 12 1987.
The district is subdivided into 5 subdistricts (tambon), which are further subdivided into 69 villages (muban). Phaya Mengrai is a township (thesaban tambon) which covers parts of tambon Mengrai and Mae Pao. There are further 5 Tambon administrative organizations (TAO).