Pailan Arrows was founded as the AIFF XI in 2010 under the recommendation of then India head coach Bob Houghton and All India Football Federation president Praful Patel after Bob noticed that almost all the India U19 and India U23 players were on the bench during the I-League season and were never getting any game time. The club was originally slated to join the I-League 2nd Division but after the disbanding of Mahindra United the AIFF allowed AIFF XI into the I-League automatically. The club participated in their first competition in 2010 which was the Federation Cup and played their first ever professional match on 21 September 2010 against JCT FC in the Federation Cup, in which AIFF XI won 1–0 with Malsawmfela scoring the first goal in the team's history. The team finished third in the group in the end, missing out on going to the next round by four points. The club then participated in their first I-League match on 3 December 2010 against Chirag United in which the club lost 1–2 and with Lalrindika Ralte scoring the first goal for the club in the league. The club then earned their first points on 8 December 2010 against ONGC F.C. after drawing 1–1. On 11 January 2011 it was announced that AIFF XI would change their name to Indian Arrows which would take effect on 1 February 2011. Arrows finished the 2010–11 I-League season in 9th place.
The summer of 2011 would be a busy one for the club. The club changed their name to Pailan Arrows on 15 June 2011 after the All India Football Federation reached an agreement with Pailan Group to sponsor the team. With the deal Pailan Arrows was also relocated to Kolkata and the Salt Lake Stadium. Then on 13 August 2012 head coach Desmond Bulpin was sacked by the club due to his "style of football" while former India national football team coach Sukhwinder Singh was signed to take over the club. The club also lost many of the stars of the previous season like Lalrindika Ralte, Jeje Lalpekhlua (top scorer for Pailan and among Indians in 2010–11), Manandeep Singh and Gurpreet Singh Sandhu. The club again participated in the Federation Cup in 2011 where Pailan won two matches but lost one which meant that they would finish 2nd behind Salgaocar and thus meant Pailan were knocked out in the group stage again. Pailan Arrows then began the 2011–12 I-League campaign against Mohun Bagan at the Salt Lake Stadium on 23 October 2012 in which they lost 1–3 after Lalrozama Fanai gave them the early lead. On 7 February 2012 Sukhwinder Singh resigned as coach of Pailan Arrows due to personal reasons, at this point also Pailan had not won a single match in I-League and had only managed eight draws in 17 matches. Assistant coach Sujit Chakravarty took over the reigns as head coach for the remainder of the season. Towards the end of the season Pailan managed to win two matches, one against Chirag United Club Kerala and another against HAL to finished the season in 13th place out of 14 teams but since they are a developmental team, Pailan were not relegated.
The club's colours were blue and white, just like the India national football team. During the first season Pailan Arrows started with a dark blue kit but eventually during the 2010–11 season the club started using a normal blue kit with black shorts. For the 2011-12 season Pailan used a dark blue jersey and a white kit with black or red socks.