In 1964, two country music performing artists, Eddie Miller and Tommy Wiggins, joined two club owners, Mickey and Chris Christensen, to found the Country and Western Music Academy, aiming to realize their collective dream of gaining support of west coast musical artists in order to promote country music in the thirteen states comprising the West Coast. Two years later, in 1966, the CWMA presented its first country music awards ceremony to honor excellence in achievement within the country music industry from during the past year. Their event marked the first country music awards backed by a major organization, and succeeded in shedding the spotlight on the genre for all the public to take notice.

Winners of the first ceremony included Buck Owens, as Top Male Vocalist; his band, the Buckaroos, as Band of the Year; Bonnie Owens, as Top Female Vocalist; and Kay Adams, as Top New Female Vocalist - all performers based on the West Coast, in keeping with the organization's mission to bring such artists recognition, as well as indicative of their membership being composed primarily of peers in country music also based on the West Coast.

The Country Music and Western Academy renamed itself the Academy of Country and Western Music in the 1970s, due to confusion it had encountered from people who had mistakenly thought it to be a music school.

The voting process that determines each year's winners involves all Academy of Country Music Awards industry professional members and consists of three rounds, all supervised by Deloitte and Touche, an international accounting firm. During the first round, members may nominate a single act in each category. From those selections, the top twenty qualifiers are compiled as official nominees for the next round of voting. During the second round, members may select up to two nominees in each category - and the top five nominees selected in each category after the votes have been tabulated become the official nominees for the final ballot. During the third and final round of voting, members choose one nominee in each category as their picks for the winners.

Beginning in 2004, Academy of Country and Western Music members have been able to place their votes online. The Academy of Country and Western Music also initiated an associate membership program that year, allowing fans to vote online for Video of the Year. In 2008, they were also able to place votes for the Entertainer of the Year category, which over 500,000 fans placed votes for.

The show's most prestigious categories are Entertainer of the Year and Artist of the Decade. The five distinguished winners of the latter awards so far have been: Marty Robbins for the 60's, Loretta Lynn for the 70's, Alabama for the 80's, Garth Brooks for the 90's, and George Straight for the first decade of the new millennium.

The trophies received by winners were designed in 1968, in the shape of a western-styled hat, which was redesigned for a sleeker, more modern look in 2003. Crystal awards of similar prestige can be found directly through online retailers.

The awards ceremony took place in Los Angeles each year until 2003, when it moved to Las Vegas' Mandalay Bay Resort & Casino Events Center, and after that to the MGM Grand Garden Arena. 1972 was the first year that their Awards show broadcast in national syndication, airing on ABC. Since then, the ceremony's broadcast has moved to NBC, then to CBS. In the days leading up to its ceremony broadcast, the Academy sponsors promotional events that bring to the public the best of country music's acts and performances, including Celebrity Golf tournaments, a Motorcycle Ride and Jam, an All-Star Jam, and a New Artists' Show.