The settlement house movement has a long and proud history of working to strengthen local communities in our society. The movement started with the foundation of settlements in large cities in the United Kingdom, the United States and other countries in the late 19th century. The key idea was that people concerned about social issues can only be effective in working for improvements if they have direct experience with the existing problems, by living among people in need and 'settling' into their neighborhoods. The movement grew fast and the International Federation was formed in 1926.

For most of the organization’s history, IFS was a small network of committed Western agencies. In the late 1980s members decided that there was a real need for an international organization that would actively support the international activities of local community organizations in a world of changing and sometimes disappearing barriers and boundaries. IFS began a deliberate process of developing a strong and independent international network which is directly involved in practical co-operative projects with local community organizations. These exchanges center on regional groups, with a Eurogroup formed in 1991, an Americas Coalition in 1994, and an Asia Network in 1996.

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