Just about 10 kilometers from busy and noisy downtown Budapest, amidst the gentle hills and woodlands of Buda, the KFKI campus is located. The first research institute on this site, the Central Research Institute for Physics of the Hungarian Academy of Sciences, was founded in 1950. From the abbreviation of its Hungarian name (Központi Fizikai Kutató Intézet) the centre was better known as KFKI. During about four decades it grew from a modest laboratory into a large research establishment covering the most diverse fields of physics and related technologies. Recently it has become an agglomerate of independent research institutes and centralized research support services surrounded by an industrial park of private enterprises utilizing mostly spin-off technologies.

The Hungarian Academy of Sciences reorganized its institutes in 1997. On January 1, 1998 the KFKI Research Institute for Solid State Physics (KFKI Szilárdtest Fizikai Kutató Intézet) merged with the TTKL Research Laboratory for Crystal Physics (MTA Kristályfizikai Kutató Laboratórium), the new institute is named Research Institute for Solid State Physics and Optics (MTA Szilárdtestfizikai és Optikai Kutató Intézet, SZFKI). The KFKI Research Institute for Materials Science (KFKI Anyagtudományi Kutató Intézet) merged with the Research Institute for Technical Physics (MTA Műszaki Fizikai Kutató Intézete), the new institute is named Research Institute for Technical Physics and Materials Science (MTA Műszaki Fizikai és Anyagtudományi Kutató Intézet, MFA). The new institutes are working on the Csillebérc campus. The KFKI Research Institute for Measurement and Computing Techniques (KFKI Mérés- és Számítástechnikai Kutatóintézet) merged with the Computer and Automation Research Institute (MTA Számítástechnikai Kutató Intézet) and the former KFKI Institute left the Csillebérc campus.

The original task of the institute was to establish an up-to-date experimental basis in branches of physics relevant to Hungary. Between 1950 and 1955 mainly those fields were covered where some expertise already existed, and chances were best for establishing competitive research teams (atomic physics, nuclear physics, cosmic rays, electromagnetic waves, spectroscopy, radiology, theoretical physics, etc.). At this time particle accelerators were constructed here to study nuclear reactions.

In the second phase (1956-1959) the sphere of interest of the institute was extended to other areas, viz. to nuclear chemistry, electronics, reactor research, solid state physics. A research reactor, bought from the Soviet Union, was installed. During the sixties the character of the research activities underwent a gradual change. The research institute which had earlier been engaged mainly in fundamental research became a research centre performing basic, applied and developmental research work as well as carrying out specific pilot manufacturing tasks. The seventies were characterized by the initiation of research programmes centred on concrete economic goals.

In the 1975-1991 period the KFKI comprised four, later five research institutes, which were to a certain extent independent from each other. Since the early nineties pilot manufacturing and a number of development tasks have been carried out by independent business enterprises. These five research institutes, (KFKI Atomic Energy Research Institute, KFKI Research Institute for Measurement and Computing Techniques, KFKI Research Institute for Materials Science, KFKI Research Institute for Solid State Physics, KFKI Research Institute for Particle and Nuclear Physics) still carrying the abbreviation KFKI in their names, became independent legal entities on 1st January 1992.

The Institute of Isotopes (Izotópkutató Intézet) was founded in 1959 for R&D in radioactive isotope production and application. Since then a wide variety of activities has developed. A fundamental reorganization was carried out in 1993, at which time, under the traditional name "Institute of Isotopes of the Hungarian Academy of Sciences", the purchy scientic activities were continued.

The basic activities of the reorganized research institute cover physical chemistry including surface science and catalysis, in particular radiation chemistry and molecular spectroscopy; nuclear and photophysics; health physics and nuclear safety.

The other parts of the former institute with main task of development and application were combined to form a limited company known as "Isotope Institute Co. Ltd".