In 1995, the Prime Minister and his delegation made a working visit to MIT and endorsed the conceptualisation of establishing a university based on the MIT model in Malaysia. An agreement was then signed in January 1997 to establish MUST.

In July 1997, the MUST Ehsan Foundation received a formal invitation to set up the university. In 1999, the Malaysian Cabinet approved a RM100 million conditional grant to MUST and in July 2000, MUST was registered as a private university.
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