Up until the late seventies, football in Saudi Arabia was organized on a regional basis, with the only nationwide tournament being King Cup of Champions. In 1976 it was deemed that local football, and transportation links, have improved sufficiently to organize a national league. Hence the Saudi League was launched with 16 clubs participating, and only 8 of them surviving in the next season. This decision was made in order to decide who relegates to the first division, and who rightfully stays on the premier league.
In 1981 it was decided to increase the number of clubs and add a second division. The league competition for the 1981–82, known as the ranking league, featured 18 clubs with the top eight qualifying for the first division and the bottom ten to the new second division. The number of first division clubs was later increased to 12 in the 1984–85 season.
In 1990 it was decided to revamp local competitions and to introduce professional football. A new league championship was formed called "The Custodian of The Two Holy Mosques League Cup", which was a two-stage championship. The first stage was a regular double round-robin league competition with the top 4 qualifying to the final knockout stage, called the golden square. Clubs were allowed to sign players on a professional basis making the league semi professional.
In 2007 It was decided to split the two stages, with the league reverting to a standard double round-robin competition, and a new domestic competition cup competition formed called "The Custodian of The Two Holy Mosques Champions Cup". This cup will feature the top six finishers in the league plus the winners of the Crown Prince Cup and the Prince Faisal Cup. This format will take effect from the 2007–08 season onwards.
As of 2008 four teams from Saudi Arabia qualify for the AFC Asian Champions League annually. This includes the top three teams of the AJL together with the winner of the King cup. If the winner of the King Cup is also among the three top AJL teams then the fourth best AJL team also qualifies.