ISTEL was formed in 1979 as BL Systems Limited (BLSL) through a merger of the computer departments of various automotive manufacturing companies brought together under the British Leyland (BL) umbrella.

John Leighfield became the chairman of the new company, which, in addition to providing the computer resources and telecommunications services for the BL companies, gradually started to provide similar services for other outside companies. The company's headquarters and offices were established in Redditch and Coventry. This organization pioneered many services, including the establishment of Europe's first microwave communications network in the late 1970s and launched Comet (originally a US product) that in 1981 was Britain's first commercial e-mail service. In

1984 the company's name was changed to ISTEL. The new company name was said to have been chosen by Leighfield randomly by combining pairs of syllables that sounded vaguely related to systems, telecommunications, or technology until he hit upon one he liked the sound of. By 1986 it was widely understood among staff to be an acronym for “In Systems The Established Leader” The more waggish staff were known to say that the acronym stood for "Information Screwed, Twisted and Eventually Lost" or "I Stand To Earn Less".

The organization grew rapidly spawning off various specialist companies such as ISTEL Automation to address various vertical markets segments. As it grew it recruited  new staff and new office facilities.

In June 1987,Rover Group (to which British Leyland had been renamed in 1986) sold ISTEL, in a management buyout, to a consortium of its management and employees, and investors, led by John Leighfield, for £35 million.

In October 1989, ISTEL was sold to AT&T and was renamed AT&T ISTEL. Latterly it was documented that in 1997 AT&T quietly dropped the ISTEL name putting its finance, commerce, travel, and healthcare divisions up for sale.

Customers included Citibank, Delta Air Lines, Barclays, Texaco, British Oxygen, Boots and the Post Office Limited. The healthcare division was sold to Atlanta-based company HBO & Company.In 1998 the company's finance and banking division was sold to Cap Gemini.In April 1998 AT&T sold the Automotive Division, the original core of ISTEL, to BMW's in house software house,  Softlab.In April 2001, following BMW's sale of Rover Group to the Phoenix Consortium the previous year, Softlab sold a significant part of its UK operations, specifically the automotive facing sections, on to Computer Sciences Corporation.

ISTEL History