KEADILAN or PKR was formed for Anwar Ibrahim and his family justice and promotes an agenda with a strong emphasis on social justice and anti-corruption. Recently the party adopted a platform that seeks to abolish the New Economic Policy and replace it with a policy with an emphasis on a non-ethnic approach in poverty eradication and correcting economic imbalances. It is one of the four component parties of the government coalition in Malaysia called the Pakatan Harapan (PH).
The year 1997 saw the Malaysian economy being affected by the Asian financial crisis. The Finance Minister at the time, Anwar Ibrahim (also a Deputy Prime Minister), instituted a series of economic reforms and austerity measures in response. These actions were exacerbated when he tabled controversial amendments to the Anti Corruption Act that sought to increase the powers of the Anti Corruption Agency. Prime Minister Mahathir Mohamad disagreed with these measures and ultimately sacked Anwar from all his posts. This incident and the circumstances in which it happened led to a public outcry in what became known as the Reformasi movement, but it also resulted in the arrest and subsequent incarceration of Anwar on what many believed to be politically motivated charges of sexual misconduct and corruption. Building on the momentum of the Reformasi, a political movement called the Social Justice Movement (Malay: Pergerakan Keadilan Sosial) (Adil) was formed. It was led by Dr Wan Azizah Wan Ismail, wife of Anwar. But, facing difficulties in registering Adil as a political party, the reformasi movement took over a small party, Ikatan Masyarakat Islam Malaysia (IKATAN), and relaunched it as the National Justice Party (Malay: Parti Keadilan Nasional) on 4 April 1999, just in time to take part in the 1999 general elections. The party has been noted as having rough similarities with the now-defunct multi-racial social democratic Parti Keadilan Masyarakat Malaysia (Pekemas). The party was joined by the Democratic Action Party (DAP), the Malaysian People's Party (PRM) and the Pan-Malaysian Islamic Party (PAS) in a broadly based electoral alliance known as Barisan Alternatif (Alternative Front) to take on the ruling BN coalition in the 1999 general elections.
Between 27 and 30 September 1999, seven activists, including Keadilan leaders; Vice-President Tian Chua, N. Gobalakrishnan, Youth leader Mohd Ezam Mohd Nor, Mohamed Azmin Ali, Fairus Izuddin and Dr Badrul Amin Baharun; were arrested and as a result prevented from contesting in the elections. Further arrests were made on 10 April 2001 and those arrested were subsequently charged and incarcerated under the Internal Security Act. They became known as the Reformasi 10.
The party entered the campaign with many of its key leaders under arrest and as a result saw it winning only five parliamentary seats in the elections despite gaining 11.67% of the total votes cast. The Barisan Alternatif as a whole gained 40.21% of the total votes cast with PAS gaining 27 seats and DAP gaining ten seats.
The post election period saw negotiations between KeADILan and Parti Rakyat Malaysia (PRM) on a possible merger. Despite some opposition in both parties to the move, a 13-point Memorandum of Understanding was eventually signed by the two parties on 5 July 2002. On 3 August 2003, the new merged entity was officially launched and assumed its current name.