Twilight Time began in 2011 as the brainchild of Brian Jamieson and Nick Redman, both veterans of the motion picture and music industry. Both founded the company as a way to release vintage films for the classic DVD collector. Initially, Twilight Time licensed 20 films from 20th Century Fox's catalog to release on DVD and, when possible, in high definition on Blu-ray. The goal was to release films of varying genres that had never been released on home video in the United States. Twilight Time's initial focus was on films of the 1950s and 1960s in what Redman called "the Cinemascope period, those gorgeous widescreen entertainments that had it all—beauty, glamour, drama." But, he added, "We will also be selectively tackling the earlier years—the 1930s and 40s—and sampling every genre, presenting, hopefully, something for everyone." Ultimately, according to Jamieson, "Twilight Time will be serving both the collectible drive of film enthusiasts, and, in a larger sense, the cause of cinema literacy." Their first title, The Kremlin Letter, was scheduled to be release on January 25, 2011, but for unknown reasons, the release was pushed back by two months.
On September 1, 2011, Twilight Time announced a deal with their second film studio, Sony Pictures, to license and release titles from the Columbia Pictures library beginning in November 2011. The first titles to be released under this partnership included Ray Harryhausen's 1961 science fiction-fantasy classic, Mysterious Island, followed by the original Fright Night, the horror-comedy cult favorite written and directed by Tom Holland. Twilight Time will only be releasing Columbia Pictures on Blu-ray if a previous Sony DVD version is already available.
While initially limiting their releases to one title per month, Twilight Time later announced that beginning in November 2011, they would begin releasing two titles per month. Towards the end of 2013, releases began to see an output of three titles per month. In an interview with NixPix, Nick Redman confirmed that Twilight Time's monthly output would continue to increase, stating, "2014 is already shaping into a significant commitment of 50 to 60 titles," which means an average of four to five titles per month.
Twilight Time announced two new studio deals in 2013. Nick Redman confirmed a deal with MGM in September 2013. The deal includes all the United Artists catalog, MGM titles from 1986 to the present, and all of the titles released through Cannon, Polygram, and Orion. As well, Twilight Time announced its first international deal in October 2013 with Protagonist Pictures. The deal gave Twilight Time the US distribution rights to movies from the Film4 library, including films from directors Ken Loach, Neil Jordan, and Paul Greengrass.
On July 1, 2015, Twilight Time began direct-to-consumer sales when they announced they would begin offering their titles through their own website TwilightTimeMovies.com as an alternative to their existing sales through Screen Archives Entertainment.