The Institute of Agriculture and Environment (PKI) commenced its activities on 1 January 2005, emerging as one of the five institutes created during the restructuring process (the transformation of EPMÜ into the Estonian University of Life Sciences). PKI became the successor to the activities of the Agronomy Faculty, the Institute of Experimental Biology, the Institute of Environmental Protection, the Polli Institute of Horticulture, the Institute of Zoology and Botany, and the EVIKA Research Centre of Plant Biotechnology of the former Estonian University of Agriculture.
In September 2017, a structural reform was implemented at the Estonian University of Life Sciences, whereby the previous departments were dissolved and, based on them, faculties were established. Following the reform, the Institute of Agriculture and Environment comprised eight faculties, and, as independent units, the Polli Horticultural Research Centre and the Rõhu Experimental Station were incorporated within PKI.
During the academic structural reform of the Estonian University of Life Sciences that came into effect on 1 January 2022, the Institute of Agriculture and Environment (PKI) and the Institute of Economics and Social Sciences (MSI) were merged into a new combined institute. The new merged institute was named the Institute of Agriculture and Environment (PKI). In this new structure, all eight former PKI faculties were retained, and the Faculty of Rural Economy became the ninth faculty of PKI.