In England, Henry VIII passed the first bankruptcy laws in 1542. In the United States the first bankruptcy laws were passed in 1800, but they were mostly temporary responses to troubled economic situations.

After the great depression of 1929, the 1933 and 1934 Acts were passed, with the intention of giving the debtor a new beginning as such.

In 1979, the bankruptcy reform law of 1978 took effect, which continues to be the federal law that governs all bankruptcy cases today. The robust chapter 11 for companies was introduced, which replaced the chapters X, XI and XIII that had been created in 1898. In a similar way the more robust personal bankruptcy, the chapter 13, which replaced the old chapter XIII was introduced. This reform facilitated the bankruptcy application, and debt restructuring for both companies and individuals.

Bankruptcy law, like most laws, continues to be perfected or adapted to the times we live in, for example, in 1994 President Bill Clinton signed the 1994 reform (Public Law 103-394), and in 2005 the president George Bush signed the BAPCA effectively making it a bankruptcy abuse prevention and consumer protection act.