The privately owned company was established in 1992 by four professional pilots and one flight engineer as LatCharter (the name derived from Latvia) and started operations in 1993 with leased Tupolev Tu-134B aircraft. The Tupolev fleet was replaced with the larger Yakovlev Yak-42 in April 2001, and then Airbus A320-200 by December 2003.
In 2008, commemorating the airline's 15th anniversary, it was renamed SmartLynx Airlines, new logo and livery were introduced.
In 2012 the airline was bought from Icelandair in a management buy-out and is now a completely separate entity. In 2012 the airline also formed a subsidiary Smartlynx Airlines Estonia with one Airbus A320-200 to serve the Estonian tour operators.