The company was founded by Pavel Benes, Miroslav Hajn, Jaroslav Frantisek Koch and Vaclav Maly in 1919 and became part of Akciova spolecnost, drive Skodovy zavody in 1928. During the 1930s the factory became the biggest aircraft producer in Czechoslovakia and moved to Letnany near Prague, where production continues until present. During World War II Avia produced aircraft for the German Luftwaffe. After the war the company was nationalized and became involved in the automotive industry. It manufactured aircraft up to 1963, then targeted on truck production and continued to make aircraft engines (producing only propellers from 1988). The company was split in 1992 into propeller and truck sections, both using the Avia brand.
By 2004, continued losses at the factory meant a take-over was inevitable for its survival. A Czech-based investment company Odien started negotiations to buy the Daewoo Steyr B.V. 50.2% share holdingЧa process completed in early 2005.
In the year 2006 Avia was bought by Indian truck manufacturer Ashok Leyland.