Danila Dilba began as a community controlled Aboriginal health service in the 1970s—a time of great activism for Indigenous people across Australia.

After Cyclone Tracy hit in 1974, Indigenous people were evacuated to southern cities where local Aboriginal medical services had started. Darwin people were impressed with the services and wanted their own one.

The name Danila Dilba Biluru Butji Binnilutlum was given to the service by the local Larrakia traditional custodians.