The area of Mae Lao district was separated from Mueang Chiang Rai district and established a minor district (King Amphoe) on May 31, 1993. It originally consisted of the four tambon Dong Mada, Chom Mok Kaeo, Bua Sali and Pa Ko Dam. It was upgraded to a full district on December 5, 1996.
The district is subdivided into 5 subdistricts (tambon), which are further subdivided into 63 villages (muban). There are two townships (thesaban tambon) - Mae Lao covers parts of tambon Dong Mada, and Pa Ko Dam parts of tambon Pa Ko Dam and Chom Mok Kaeo. There are further 5 Tambon administrative organizations (TAO).