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Flight operations began on 1 August 1972 utilising the only aircraft of the company: a Fokker F-27 Friendship.
Air Botswana operations are regulated by the Department of Civil Aviation under the Civil Aviation Act (1977).
Also in 1981, Botswana Development Corporation was formed as a part of Air Botswana Holdings, with the corporation being tasked to acquire an aircraft for the airline to lease.
In 1983 a Lockheed L-100-30 Hercules was leased and Air Botswana Cargo was formed to operate cargo charters, and when South African Airways ended services to Lesotho and Swaziland, a second F27 was acquired and services to Maseru and Manzini were inaugurated.
The 57 million pula Sir Seretse Khama International Airport opened on 10 December 1984, seeing Air Botswana operating from the airport.
A sixteen-seat Dornier 228-200 was leased in December 1984 from Kalahari Air Service, with the latter flying and maintaining the aircraft for Air Botswana.
By the end of 1986, the route network included Gaborone, Francistown, Johannesburg, Harare, Lusaka, Manzini, Maseru, Maun, Selebi-Phikwe and Victoria Falls.
In April 1988 with the enactment of the Air Botswana Act the airline became a parastatal under the then Ministry of Works, Transport and Communications (now the Ministry of Transport and Communications).
Also in April 1988, Air Botswana became the first airline from the Southern African Development Coordination Conference (SADCC) to establish air links with Namibia.
On 11 October 1999, the airline was crippled when one of its pilots, Chris Phatswe, crashed an empty ATR 42 aircraft into Sir Seretse Khama International Airport, destroying the aircraft and two more Air Botswana ATR 42s.
The privatisation process began on 19 April 2000, when the government signed a consultancy agreement with World Bank-affiliated International Finance Corporation, which saw IFC being appointed as the government's main adviser in the privatisation process.
Comair withdrew in December 2003, due in part to increased competition by low-cost airlines in the South African market.
However, in the five years to 2003, the government had not had to subsidise Air Botswana, and in the previous six years had made a profit.
In 2003, the government attempted to privatise the airline, with Air Mauritius and Comair put forward as strategic partners.
The Sunday Standard also revealed that the blueprint for the privatisation of the airline was written by Airlink CEO Roger Foster, and was used by Botswana in its negotiations with the airline, in contravention of the Botswana Privatisation Policy of 2003.
The government suspended the search for a strategic partner in February 2004.
It was revealed by the press that Nico Czypionka, the man responsible for leading negotiations between the government and Airlink, had convinced the government as early as April 2006 to go into partnership with the South African airline.
In September 2006 it was announced that three potential investors had placed bids for the tender to take over the airline: Airlink of South Africa, African World Airways Ltd, and Lobtrans (Ltd), a local truck fuel transporter.
In November 2006, the Public Enterprises Evaluation and Privatisation Agency announced that Airlink has been put forward by the Ministry of Works and Transport as the preferred bidder for Air Botswana.
Following a P300 million loss in the first quarter of 2006, the Sunday Standard reported that the government hurriedly began efforts to privatise the airline before it became insolvent.
In December 2008, Air Botswana signed a deal with ATR for two 68-seat ATR 72–500 regional airliners worth US$37 million.
At the end of 2008, it was reported that Lebedev had abandoned plans for investment in Air Botswana.
The aircraft were delivered in March 2009, and it was announced that routes linking Kasane and Francistown with Johannesburg would be restarted.
In July 2009, Air Botswana signed a codeshare agreement with Kenya Airways, which began flights to Gaborone on 6 September with three flights per week.
In late 2015, Tshenolo Mabeo the, Minister responsible for Transport, sacked the then General Manager Ben Dahwa together with his entire board of directors, following allegations of corruption.
General Tebogo Carter Masire, former Botswana Defence Force (BDF) Commander, was appointed in February 2016 to lead Air Botswana as board chairman, replacing Nigel Dixon-Warren.
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