The institute is located in Garching, Germany, which in turn is located 10 km north-east of Munich. Four research groups work in the fields of laser physics, laser chemistry, laser spectroscopy and quantum dynamics.
The institute was accommodated for a time on the premises of the Max Planck Institute for Plasma Physics. The institute moved to the new building in July, 1986 and officially separated from the Max Planck Institute for Plasma Physics. With the appointment of Theodor Hänsch as head of the new institute from Stanford University, the institute grew significantly. Hänsch was also given a chair at the Ludwig Maximilian University of Munich which ensured close links between MPQ and the university complex in Munich. After the retirement of Siegbert Witkowski in 1993, the research on the high energy laser was stopped and other research areas were started. The new Department of Quantum Dynamics of Gerhard Rempe started working in 1999.
In 2005, Theodor W. Hänsch of this institute was awarded the Nobel Prize in Physics, together with John L. Hall, "for their contributions to the development of laser-based precision spectroscopy, including the optical frequency comb technique".