On 14 February 2002 with a view of providing medical services as deemed necessary to APF personnel and their dependants a medical branch was initiated at the premises of Armed Police Force headquarters in Kathmandu.
Despite its limited medical supply and services, this medical branch however successfully launched necessary lifeline services such as OPD, emergency, X-ray, and physiotherapy including pharmacy. The paramedics were recruited from time to time to meet current and future requirements and medical challenges

For cases of intensive care by experts, the renowned hospitals of the country such as Teaching Hospital, NA Hospital, Bir Hospital, Orthopaedic Hospital, and Memorial Hospital were in practice of being approached.

On 15 December 2003 with the concurrent extension of APF offices and strength countrywide, the medical branch was upgraded to APF Hospital.

In the light of the volume of pouring in outdoor patients on Feb 16, 2005 the then His Majesty's Government sanctioned for the foundation of APF Hospital with a capacity of 110 beds. The newly constructed APF Hospital at Balambu, Kathmandu reserves 5 beds each for National Investigations Department and the locals and remainder number 100 for own staff.