At the very beginning, in 18 November 1958 was established Tabligh Muhammadiyah Academy. This Academy was under care of Management Centre of Majlis Tabligh Muhammadiyah. Tabligh Academy was aimed to “bring out mubaligh in order to support the aims of Muhammadiyah as the Islamic dakwah, amar ma’ruf nahi munkar.” The implementation of Tabligh Academy least until 1963.
In the academic year of 1963/1964, Tabligh Muhammadiyah Academy has been changed to Faculty of Religious Study Department of Da’wah Muhammadiyah and centralize the academic activities in Pawiyatan Elementary School (Muhammadiyah Elementary School) and it was located to the south of Masjid Besar Kauman Yogyakarta. Faculty of Religious Study Department of Da’wah Muhammadiyah was the subdivision of Universitas Muhammadiyah Jakarta. Three years after UMY was established, in academic year of 1984/1985, Faculty of Religious Study Department of Da’wah Muhammadiyah was officially joined to UMY and has been changed to Department of Da’wah. Department of Da’wah was the only one of religious faculty in UMY and the learning activity was held in Jl. HOS Cokroaminoto 17 Yogyakarta.
In the academic year of 1987/1988, based on the proposal of Kopertais Regional III DIY the religious faculty has been developed into two which are Faculty of Da’wah and Faculty of Tarbiyah. Then, based on the decree of Ministry of Religious Affairs No 72 on 8 February 1995 decided that Faculty of Da’wah and Faculty of Tarbiyah has been changed and merged into Faculty of Islamic Religion.
In the academic year of 1998/1999 Faculty of Islamic Religion UMY was established Muamalat (Syari’ah) as the new study program with the concentration of Islamic Banking and Finance.