The British Columbia Law Institute was created in January 1997 by incorporation under the Provincial Society Act. The broad purposes of the Institute, described in Article 2 of its Constitution, are to:

• promote the clarification and simplification of the law and its adaptation to modern social needs,
• promote improvement of the administration of justice and respect for the rule of law, and
• promote and carry out scholarly legal research.

The Institute was created in response to a decision by the Ministry of Attorney General to withdraw program funding from the Law Reform Commission of British Columbia. The disappearance of the Commission, without replacement, had the potential to create a serious vacuum in the legal resources available to the people of British Columbia and carried a significant risk that the tangible and intellectual assets of the Commission would become dissipated and irretrievably lost. The Institute was created as a successor body to mitigate this loss.

The by-laws of the Institute provide that it is composed of 14 members, eight appointed by stakeholder groups and the balance serving as "members-at-large." Every member of the Institute is also a director.