In 1982, the government of Turkey founded the Institute of Turkish Studies (ITS) with an endowment of $3 million to fund scholarship on Turkish culture and history. Throughout its existence, the ITS spent around $350,000 a year to give grants, scholarships, subventions, and seed money to 400 scholars in 19 universities to promote Turkish studies. Grants were given to help American students and scholars travel to Turkey for research and conferences and publish books and journals. There were also grants given to universities to create Turkish Studies departments and positions, host conferences, and acquire and catalog books. The ITS focused on research related to Turkish history and culture, as well as contemporary political, social, and economic developments in Turkey.

Turkey’s Ambassador to the United States held the position of honorary chairman of the board of governors. The board consisted of prominent former State Department officials and well-known American scholars in Ottoman and modern Turkish studies.

The Institute found itself embroiled in controversy around Armenian genocide denialism several times in its history. A 1995 article published in the Holocaust and Genocide Studies journal exposed correspondence between Heath Lowry, the first executive director of the ITS, and the Turkish Ambassador to the United States, Nüzhet Kandemir, discussing how to prevent mention of the Armenian genocide in scholarly works. This led to accusations that ITS was acting as a propaganda arm of the Turkish government, stifling research into the genocide.

In 2006, Donald Quataert, a history professor at the State University of New York at Binghamton, resigned from his position as chair of the ITS board, stating the Turkish ambassador had pressured him to either quit or see the institute’s funding withdrawn after he used the word “genocide” in a book review. Several more members of the board resigned in protest in the following years.

In 2015, Turkey withdrew funding from the Institute. It was widely speculated in the press, including by members of the ITS board, that the increasingly authoritatrian Turkish government disliked the Institute's academicly neutral stance toward scholars applying for funding. In May 2019, the ITS board of directors announced plans to close effective September 30, 2020, citing the institute’s inability to find replacement income.