Tara Air was formed in 2009 when Yeti Airlines split its STOL operations from its regional operations. The airlines' STOL operations were rebranded as Tara Air and focused on providing services into remote and mountainous airports and airstrips.
The airline operates scheduled domestic flights to a number of destinations as well as offering air charter services. Tara Air operates daily scheduled flights between Kathmandu and Lukla, and between Jomsom and Pokhara. Other destinations are served at varying frequency.
Tara Air operates several aircraft that were previously operated under the Yeti Airlines brand. These aircraft have now been re-branded in Tara Air livery, which uses an almost identical colour scheme to Yeti Airlines.
On 26 May 2010 a Tara Air DHC-6 Twin Otter had taken off from Birendranagar Airport In Surkhet heading for Talcha Airport in Rara with 18 passengers and 3 crew on board. At 10 am the aircraft had to make an emergency landing at Birendranagar Airport after its cabin door suddenly opened five minutes after take-off. Tara Air officials said that the cabin attendant managed to lock the door immediately after it opened to avert any possible mishaps.
On 15 December 2010 a Tara Air DHC-6 Twin Otter crashed shortly after takeoff from Lamidanda Airport in Nepal; it was en route to Kathmandu. Two helicopters were dispatched to search for the plane, which was discovered in heavily-mountainous terrain. All 19 passengers (18 Bhutanese and one American) and 3 flight crew were killed.