With phenomenal increase in students' enrollment in 1970's, a plan to establish additional campuses of the University of Engineering and Technology Lahore was conceived. As a result of that, the University College of Engineering Taxila was established in 1975. For three years it functioned at Sahiwal. In 1978 it was shifted to its permanent location at Taxila. The College continued its working under the administrative control of the University of Engineering and Technology, Lahore till October 1993. During this month it received its charter as an independent university under the University of Engineering and Technology Taxila Ordinance 1993. At present total enrollment of undergraduate and postgraduate students is above 2000.

The University main campus is located on the outskirts of Taxila at a distance of 5 km from the city. It is situated near railway station Mohra Shah Wali Shah on Taxila-Havelian branch line. The city of Taxila is 35 km from the twin cities of Islamabad and Rawalpindi on the main Rawalpindi- Peshawar highway. The University buses commute daily between the campus and the cities of Islamabad, Rawalpindi and Wah Cantt. The campus covers an area of 163 acres. All the teaching departments, residential colony for teachers/ employees, student hostels, guesthouse, post office and bank are housed on campus.

Almost thirty years after the establishment of the main campus, first campus of UET Taxila at Chakwal started functioning in the year 2005. So far, two sessions have been enrolled in Electronics and Mechatronics engineering. Annual intake in each discipline is 52.The Sub-campus is situated in the heart of the Chakwal city in old Kachehri complex on Talagang road . Chakwal is located 110 Km south-east of the capital city of Islamabad in the Dhanni region of the Pothohar Plateau. The Chakwal campus can easily be approached by either of the two exits on the Motorway M2. i.e., Balkassar and Kallar Kahar. The main campus is under construction near the Balkasaar Interchange on a vast piece of land.

The sub-Campus Chakwal of UET Taxila offers four years under graduate programs in Electronics and Mechatronics Engineering.The Sub-Campus Chakwal has planned to establish three more departments in the second phase. The degree awarding programs in Electrical, Mechanical, and Gas & Petroleum engineering will be started with the help of Higher Education Commission.