Universiti Malaysia Terengganu began as the Center for Fisheries and Marine Science of Universiti Putra Malaysia, located at Mengabang Telipot, Kuala Terengganu. It provided facilities for students from the Fisheries and Marine Science programs to conduct their practical sessions and there were also research facilities for lecturers.
Eventually, the Faculty of Fisheries and Marine Science of Universiti Putra Malaysia (UPM) in Serdang was transferred to Kuala Terengganu, and the Center transformed into a branch campus, being renamed Universiti Putra Malaysia Terengganu (UPMT) in June 1996. The name of the faculty was also changed, to the Faculty of Applied Sciences and Technology. Also formed were the Faculty of Science and Professional Literature and the Matriculation Center.
The establishment of Terengganu University College (KUT) was passed by the Cabinet of Malaysia on 5 May 1999 as an associate campus of UPM. Terengganu Universiti College was given autonomy on 1 May 2001 and was renamed the Malaysian Science and Technology University College (KUSTEM) on 20 June 2001.
On 1 February 2007, KUSTEM was given the status of a full-fledged university, and with that elevation, its name was again changed to its current title of Universiti Malaysia Terengganu.