Originally formed as a four-piece hardcore punk band, the Young Aborigines, in 1978 by Diamond (vocals), John Berry (guitar), Yauch (bass) and Kate Schellenbach (drums), the band appeared on the compilation cassette New York Thrash, contributing two songs from their first EP, Polly Wog Stew, in 1982. Berry left shortly thereafter, and was replaced by Horovitz. After achieving moderate local success with the 1983 experimental hip hop 12-inch single "Cooky Puss", Schellenbach dropped out and the Beastie Boys made a full transition to hip hop, releasing a string of successful singles. They toured with Madonna in 1985 and a year later released their debut album Licensed to Ill. The Beastie Boys have sold 26 million records in the United States and 50 million records worldwide, making them, according to Billboard, the biggest-selling rap group since the magazine began recording sales data in 1991.

Prior to forming the Beastie Boys, Michael Diamond was part of a number of bands such as the Walden Jazz Band, BAN, and The Young Aborigines. The Beastie Boys formed in July 1981 when the Young Aborigines Bassist Jeremy Shatan left New York City for the summer and the remaining members Michael Diamond, John Berry and Kate Schellenbach formed a new hardcore punk band with Adam Yauch called Beastie Boys. The band supported Bad Brains, the Dead Kennedys, the Misfits and Reagan Youth at venues such as CBGB, A7, Trudy Hellers Place and Max's Kansas City, playing at the latter venue on its closing night. In November 1982, the Beastie Boys recorded the 7" EP Polly Wog Stew at 171A studios, an early recorded Example of New York hardcore.

Berry left the group in 1982 (later forming Thwig, Big Fat Love and Bourbon Deluxe) and was replaced by Adam Horovitz, Guitarist of The Young and the Useless, who had become close friends with the Beastie Boys at this point; Schellenbach left the band in 1984 and was not replaced, with Diamond filling the role of Drummer. The band also recorded and then performed its first hip hop track, "Cooky Puss", based on a prank call by the group to Carvel Ice Cream franchise in 1983. It was a part of the new lineup's first EP, also called Cooky Puss, which was the first piece of work that showed their incorporation of the underground rap phenomenon and the use of samples. It quickly became a hit in New York underground dance clubs and night clubs upon its release.

In 1983, the new lineup released the Cooky Puss EP, which offered the first evidence of them picking up on the underground rap phenomenon and the use of samples. "Beastie Revolution" was later sampled for a British Airways commercial. The Beastie Boys sued them over the use of the song, earning them $40,000 in royalties.

They released the 12-inch single "Rock Hard" in 1984, which would be the second record released by Def Jam crediting Rubin as Producer. In 1985, the band opened for John Lydon's post-Sex Pistols band Public Image Ltd., as well as supporting Madonna on her North American The Virgin Tour. Then headlining with Fishbone and Murphy's Law with DJ Hurricane and later in the year, the group was on the Raising Hell tour with Run-DMC, Whodini, LL Cool J, and the Timex Social Club. With their exposure on this tour, the track "Hold It Now, Hit It" charted on Billboard's US R&B and dance charts. The track "She's on It" from the Krush Groove Soundtrack continued in a rap/metal vein while a double A-side 12", "Paul Revere/The New Style", was released at the end of the year.

The band recorded Licensed to Ill throughout 1986 and released the album on November 15, 1986. The album was well-received, and was favorably reviewed by Rolling Stone magazine with the now-famous headline, "Three Idiots Create a Masterpiece". Licensed to Ill became the best-selling rap album of the 1980s and the first rap album to go number 1 on the Billboard 200 chart, where it stayed for five weeks. It also reached number 2 on the Top R&B album charts. It was Def Jam's fastest selling debut record to date and sold over nine million copies. The fourth single from the album, "(You Gotta) Fight for Your Right (To Party!)", reached number 7 on the Billboard Hot 100, and the video (directed by Ric Menello and Adam Dubin) became an MTV staple. Another song from the album, "No Sleep till Brooklyn", released in 1987, peaked at number 14 on the UK Singles Chart.

Around the time of the release of their debut album, Licensed to Ill, Mike D started to appear on stage and in publicity photographs wearing a large Volkswagen emblem attached to a chain-link necklace. This started a rash of thefts of the emblem from vehicles around the world as fans tried to emulate him. A controversial concert in Columbus, Georgia in 1987 led to the passage of a lewdness ordinance in that city.

After the success of Licensed to Ill, the Beasties parted ways with Def Jam and ended their relationship with Rick Rubin to sign with Capitol Records. Tougher Than Leather, a movie made by Rick Rubin as a star vehicle for Run-D.M.C. and Def Jam Recordings with appearances by the Beastie Boys when they were still with the label, was released in 1988.

The group re-entered the studio in 1988, emerging with a more artistically mature second album, Paul's Boutique, released on July 25, 1989 by Capitol Records, after the falling out between the group and Def Jam Recordings. It failed to match the sales of Licensed to Ill, peaking at number 14 on the Billboard 200 and number 24 on the Billboard R&B charts. The lead single, "Hey Ladies", reached number 36 on the Billboard 100 and number 10 on the R&B charts. Rolling Stone would describe the album as "the Pet Sounds/The Dark Side of the Moon of hip hop." Produced by the Dust Brothers and Matt Dike, Paul's Boutique is an extremely sample-laden opus and is considered one of the strongest works by the Beastie Boys. Rolling Stone ranked it number 156 on its list of the 500 Greatest Albums of All Time. It is also considered a landmark in hip hop recordings due to its large array of samples and intricate use of multi-layering. Paul's Boutique would eventually sell a million copies, despite the initially weak commercial reception. The album was titled after a Lower East Manhattan thrift store. The album was remastered and re-released in 2009.

Due to the success of "Cooky Puss", they began to incorporate rap into their sets. They decided to hire a DJ for their live shows and ended up getting an NYU student named Rick Rubin. Soon thereafter, Rubin began producing records. He formed Def Jam Recordings with fellow NY University student, Russell Simmons, and approached the band about producing them for his new label. Around the same time, the band made a more complete switch over from a punk rock outfit to a three-man rap trio with Drummer Kate Schellenbach leaving the group (later to join Luscious Jackson in 1991) and Diamond, Yauch and Horovitz each adopting their own hip hop monikers—Mike D, MCA and Ad-Rock respectively.

In 1992, The Beastie Boys decided to sample portions of the sound recording of "Choir" by James Newton in various renditions of their song "Pass the Mic". The band did not, however, obtain a license from Newton to use the underlying composition. Pursuant to their license from ECM Records, the Beastie Boys digitally sampled the opening six seconds of Newton's sound recording of "Choir", and repeated this six-second sample as a back ground element throughout their song. Newton brought suit, claiming that the Beastie Boys infringed his copyright in the underlying composition of "Choir". The district court granted the Beastie Boys a summary of judgement in their favor. The district court said that no license was required because the three-note segment of "Choir" lacked the requisite originality and was therefore not copyrightable.

The Beastie Boys also published Grand Royal Magazine, with the first edition in 1993 featuring a cover story on Bruce Lee, artwork by George Clinton, and interviews with Kareem Abdul-Jabbar and A Tribe Called Quest MC Q-Tip. The 1995 issue of the magazine contained a memorable piece on the mullet. The Oxford English Dictionary cites this as the first published use of the term, along with the lyrics from the Beasties' 1994 song, "Mullet Head". That term was not heard in the 1980s, even though that decade has retroactively been hailed as the mullet's peak in popularity. The OED says that the term was "apparently coined, and certainly popularized, by US hip-hop group the Beastie Boys". Grand Royal Magazine is also responsible for giving British band Sneaker Pimps their name.

In 1994, Adam Yauch and Activist Erin Potts organized the Tibetan Freedom Concert in order to raise awareness of humans rights abuses by the Chinese government on the Tibetan people.

In 1995, the popularity of Beastie Boys was underlined when tickets for an arena tour went on sale in the US and Madison Square Garden and Chicago's Rosemont Horizon sold out within 30 minutes. One dollar from each ticket sold went through Milarepa to local charities in each city on the tour. The Beastie Boys toured South America and Southeast Asia for the first time. The band also released Aglio e Olio, a collection of eight songs lasting just 11 minutes harking back to their punk roots, in 1995. The in Sound from Way Out!, a collection of previously released jazz/funk instrumentals, was released on Grand Royal in 1996 with the title and artwork a homage to an album by electronic pop music pioneers Perrey and Kingsley.

Beastie Boys started an arena tour in 1998. Through Ian C. Rogers, the band made live downloads of their performances available for their fans, but were temporarily thwarted when Capitol Records removed them from its website. The Beastie Boys was one of the first bands who made MP3 downloads available on their website; they got a high level of response and public awareness as a result including a published article in The Wall Street Journal on the band's efforts.

Beastie Boys released The Sounds of Science, a two-CD anthology of their works in 1999. This album reached number  19 on the Billboard 200, number 18 in Canada, and number 14 on the R&B/Hip Hop charts. The one new song, the single "Alive", reached number 11 on the Billboard's Modern Rock chart.

Under the name "Country Mike", Mike D recorded an album, Country Mike's Greatest Hits, and gave it to friends and family for Christmas in 2000. Adam "Ad-Rock" Horovitz's side project BS 2000 released Simply Mortified in 2001.

The band increased its level of political activism after the September 11, 2001 attacks, organizing and headlining the New Yorkers Against Violence Concert at the Hamerstein Ballroom in October 2001.(registration required)

In 2002, Adam Yauch started building a new studio facility, Oscilloscope Laboratories, in downtown Manhattan, New York and the band started work on a new album there. The band released a protest song, "In A World Gone Mad", against the 2003 Iraq war as a free download on several websites, including the Milarepa website, the MTV website, MoveOn.org, and Win Without War. The 19th and 20th Tibetan Freedom Concerts were held in Tokyo and Taipei, Beastie Boys' first Taiwan appearance. Beastie Boys also headlined the Coachella Valley Music and Arts Festival.

In 2003, Beastie Boys were involved in the landmark sampling decision, Newton v. Diamond. In that case, a federal judge ruled that the band was not liable for sampling James Newton's "Choir" in their track, "Pass the Mic". The sample used is the six-second flute stab. In short, the Beasties cleared the sample but obtained only the rights to use the sound recording and not the composition rights to the song "Choir". In the decision, the judge found that:

To the 5 Boroughs was released worldwide on June 15, 2004. It was the first album the Beastie Boys produced themselves and reached number 1 on the Billboard album charts, number 2 in the UK and Australia, and number 3 in Germany. The first single from the album, "Ch-Check It Out", reached number 1 in Canada and on the US Modern Rock Tracks chart.

The band stated in mid-2006 that they were writing material for their next album and would be producing it themselves.

The Beastie Boys are considered very influential in both the hip hop and rock music scenes, with artists such as Eminem, Rage Against the Machine, Hed PE, Limp Bizkit, Sublime, and Blur citing them as an influence. Beastie Boys have had four albums reach the top of the Billboard album charts (Licensed to Ill, Ill Communication, Hello Nasty and To The 5 Boroughs) since 1986. In the November 2004 issue, Rolling Stone named "Sabotage" the 475th song on their 500 Greatest Songs of All Time list. In their April 2005 issue, Rolling Stone ranked them number 77 on their list of the 100 Greatest Artists of All Time. VH1 ranked them number 89 on their list of their 100 Greatest Artists of All Time. On September 27, 2007, it was announced that Beastie Boys were one of the nine nominees for the 2008 Rock and Roll Hall of Fame Inductions. In December 2011, they were announced to be official 2012 inductees.

They won a Grammy for The Mix-Up in the "Best Pop Instrumental Album" category at the 50th Annual Grammy Awards in 2008.

On July 20, Yauch announced on the Beastie Boys' official YouTube channel and through the fan mailing list, the cancellation of several tour dates and the postponement of the new album due to the discovery of a cancerous tumor in his parotid gland and a lymph node. The group also had to cancel their co-headlining gig at the Osheaga Festival in Montreal as well as a headlining spot at 2009's Lollapalooza and also another headlining spot for the first night of the All Points West Festival in Jersey City, New Jersey.

In late October 2010, the Beastie Boys sent out two emails regarding the status of Hot Sauce Committee Pts. 1 and 2 to their online mailing list. An email dated October 18 read: "Although we regret to inform you that Hot Sauce Committee Part 1 will continue to be delayed indefinitely, Hot Sauce Committee Part 2 will be released on time as originally planned in spring of 2011." One week later, a second email was sent out, reading as follows:

The official release dates were April 27, 2011 for Japan; April 29 in the UK and Europe, and May 3, 2011 in the US. The third single for the album is "Make Some Noise" was made available for download on April 11, 2011 as well as a limited edition 7" vinyl single for Record Store Day five days later with a Passion Pit remix of the track as a b-side. The track was leaked online on April 6 and subsequently made available via their blog.

On May 4, 2012, Yauch died from cancer at the age of 47. On May 24, in an interview with Rolling Stone, Mike D said that the Beastie Boys recorded new music in late 2011 after the release of Hot Sauce Committee (Part 2), but he did not say if these recordings would be released. He also said that the Beastie Boys would likely disband due to the death of MCA, though he was open to making new music with Ad-Rock and that "Yauch would genuinely want us to try whatever crazy thing we wanted but never got around to."

On May 3, 2013 a children's playground in Brooklyn was renamed for Adam Yauch. In June 2014, Mike D stated that neither he nor Horovitz would perform under the Beastie Boys name again out of respect for Yauch.

Beastie Boys headlined at Lollapalooza—an American travelling music festival—in 1994, together with The Smashing Pumpkins. In addition, the band performed three concerts (in Los Angeles, New York City, and Washington D.C.) to raise money for the Milarepa Fund and dedicated the royalties from "Shambala" and "Bodhisattva Vow" from the Ill Communication to the cause. The Milarepa Fund aims to raise awareness of Tibetan human rights issues and the exile of the Dalai Lama. In 1996, Yauch organized the largest rock benefit show since 1985's Live Aid – the Tibetan Freedom Concert, a two-day festival at Golden Gate Park in San Francisco that attracted over 100,000 attendees.

Founding Beastie Boys Guitarist John Berry died on May 19, 2016, aged 52, as a result of frontotemporal dementia, after a decline of health for several years. He was credited with coming up with the Beastie Boys name, and played guitar on the first EP the Beastie Boys recorded. Before the Beastie Boys, he was also a part of Even Worse, Big Fat Love, Highway Stars, Bourbon Deluxe, and Idaho. The first Beastie Boys show took place at Berry's loft.