The flag was originally designed in 1885 by the Colombo Committee, in Colombo, Sri Lanka. The committee consisted of Ven. Hikkaduwe Sri Sumangala Thera (chairman), Ven. Migettuwatte Gunananda Thera, Don Carolis Hewavitharana (father of Anagarika Dharmapala), Andiris Perera Dharmagunawardhana (maternal grandfather of Anagarika Dharmapala), William de Abrew, Charles A. de Silva, Peter de Abrew, H. William Fernando, N. S. Fernando and Carolis Pujitha Gunawardena (secretary).
This flag was published in the Sarasavi Sandaresa newspaper of 17 April 1885 and was first hoisted in public on Vesak day, 28 April 1885 at the Dipaduttamarama, Kotahena, by Ven. Migettuwatte Gunananda Thera. This was the first Vesak public holiday under British rule.
Colonel Henry Steel Olcott, an American journalist, founder and first president of the Theosophical Society, felt that its long streaming shape made it inconvenient for general use. He therefore suggested modifying it so that it was the size and shape of national flags. Modifications were made accordingly, which were adopted. The modified flag was published in the Sarasavi Sandaresa of 8 April 1886 and first hoisted on Vesak day 1886.
In 1889 the modified flag was introduced to Japan by Anagarika Dharmapala and Olcott - who presented it to the Emperor - and subsequently to Burma.
At the inaugural conference of the World Fellowship of Buddhists on 25 May 1950, its founder President Professor G P Malasekera proposed that this flag be adopted as the flag of Buddhists throughout the world; this motion was unanimously passed.