On 11th April 1946, representatives of the UK Air Training Corps (ATC) visited Montreal to discuss matters of mutual interest with the Air Cadet League of Canada (ACLC). At this meeting, the ATC welcomed a proposal made by the ACLC for an Air Cadet exchange plan and it was agreed to submit an official proposal on both sides of the Atlantic.

It can therefore be recorded that the Montreal meeting established the beginning of the International Air Cadet Exchange.

Plans were later made for the first exchange between Canada and the UK based on 23 cadets and two Escort Officers. Unfortunately, the project had to be postponed because of an outbreak of polio in Canada.

The next phase in the development of the scheme began when Air Cadet League representatives met RAF and ATC colleagues in London to discuss exchange plans for 1947. The ACLC urged the approval of an exchange of 46 cadets from each country in the summer of 1947. The UK Secretary of State for Air supported the proposal.

As a result of the London Conference, the first exchange of 46 cadets and two escort officers was carried out between Canada and the U K and was the foundation for all future developments.

With a view to extending the exchange plan to include the United States, the Air Cadet League contacted the Civil Air Patrol (CAP) National Commander in late 1947. The CAP Commander and his staff attended the ACLC Annual Meeting in February 1948 and plans were initiated for the first exchange of Air Cadets between Canada and the CAP, which was completed during the following summer months. Later that year, CAP Headquarters asked to exchange cadets directly with the ATC. The ACLC successfully negotiated the CAP-ATC exchange at a second conference in London and reported this information by trans-Atlantic telephone to the CAP Headquarters in Washington, DC.

Following contacts made by Canada with the Royal Swedish Air Force, the first Swedish exchange cadet visited Canada in 1950. The Air Cadet League made similar contacts with the Air Forces and Flying Club organizations in Norway, Netherlands and Denmark and cadets from these countries were also invited to visit Canada. This set the stage for a reciprocal exchange of two cadets with each of the four continental countries mentioned, which commenced in 1952.

At the same time, the United States launched an expansion of its own exchange programme that at one point involved 19 countries including a few in South America.
By the mid-1950s, it was apparent that the need existed for an international organization to coordinate and administer the overall exchange effort. This led to the establishment of the International Air Cadet Exchange Association.

A Planning Conference is held each autumn hosted by one of the participating countries. At these conferences, the details of the exchange programme for the following year are agreed. To provide administrative services continuity, a secretariat has been established and the participating countries make an annual contribution to support the Association.

Each member organization is responsible for the exchange costs in its own country and for transporting their cadets and escorts to and from the host country or assembly point. Based on the value and importance governments attach to the IACE programme, military air transportation is frequently provided although some countries transport their cadets and escorts by civil aircraft, and others by ground transportation.

IACE Programme finance varies between countries, but many rely on support received from their aviation and engineering industries, national aero clubs, youth air organizations and private individuals. Some countries with government-sponsored youth air organizations receive direct financial support for the exchange programme from their governments. Visiting cadets and escorts incur no expenses in the host countries apart from private expenditure.

As it is generally agreed that expansion of the Air Cadet Exchange Programme is desirable, invitations are regularly extended to additional countries. As a result, there has been a gradual expansion in the number of participating countries. Currently, membership fluctuates annually based on each country's ability to participate.