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American International Pictures was formed in 1954 as American Releasing Corporation by James H. Nicholson and Samuel Z. Arkoff, dedicated to releasing independently produced, low-budget films, primarily of interest to the teenagers of the 1950s. It was renamed American International Pictures, or AIP, in 1956. Nicholson and Arkoff served as producers while brothers Gene and Roger Corman were the main directors. Writer Charles B. Griffith wrote most of the early films, and also appeared as a holdup man in AIP's hurriedly made masterpiece, Little Shop of Horrors. Later writers included Ray Russell, Richard Matheson and Charles Beaumont. Floyd Crosby, famous for his camera work on a number of exotic documentaries and the Oscar winner, High Noon, was chief cinematographer. His innovative use of surreal color and odd lenses and angles gave AIP films a signature look. The early rubber monster suits and minatures of Paul Blaisdell embodied the best of Fifties monsterdom.

The earlier films of AIP often included Vincent Price, and often in roles based upon the stories of Edgar Allan Poe, whose works had a high recognition value and also were in the public domain and therefore royalty free—a real bonus for a low budget company. The films on Poe themes starring Price made AIP an American counterpart to the British studio Hammer Films and its famous Hammer Horror line featuring Peter Cushing and Christopher Lee.

AIP was the first company to use focus groups, polling actual American teenagers about what they would like to see and using their responses to determine titles, stars, and story content. A typical sequence of production involved coming up with a great title, getting an artist to create a dynamic, eye-catching poster, then raising the cash, and finally actually writing and casting the film.

In the 1960s, AIP produced a series of "Beach Party" films, starring Annette Funicello and Frankie Avalon.

In the 1970s, AIP began to produce big budget films such as The Amityville Horror, Love at First Bite, and The Island of Dr. Moreau. The massive spending on these projects, though they did make money, contributed to the company's downfall. In 1979, AIP was merged into Filmways, Inc., which was later bought by Orion Pictures Corporation.

The many modern film independent companies such as Troma owe much to the trailblazing of American International. Roger Corman continues his work as the head of New Line Cinema, which also has a long history of independent production and distribution of foreign made movies.