Eluxolweni Shelter was established in the early 1990's through the initiatives of a collection of theological students in Grahamstown. They started by identifying a safe place for street children looking specifically at the need to provide these children with food, and operated at the local Presbyterian Church on Saturdays. The children would attend church at the Anglican Cathedral where they would receive a light supper in the evenings.

In 1993 this initiative was supported by a group called Masincedane Children's project which looked for an establishment to house these children. After a period of hard work they approached Transnet Ltd who replied positively, giving them a former rest house initially intended for their train drivers.

The building was later transferred into the possession of the group. It subsequently became an established children's shelter which was run by a sub-committee (consisting of concerned citizens and theological students) of the Grahamstown Child Welfare Society. Their major duty was to fundraise and to look for donations from all spheres for the shelter to survive. The organisation also sought aid from similar existing institutions like the Daily Bread Charitable Trust in East London.

The Daily Bread Charitable Trust has played a pivotal role in assisting with the strategic development of the organisation; hiring the staff and administering finance. However, in 1991 it was noticed that the shelter needed to grow in a different direction from Daily Bread. The establishment of a new interim committee kept things going in the right direction, and in 2001 Eluxolweni Shelter officially became an independent entity. The newly established Eluxolweni Charitable Trust (Registration No. IT256/2001) is now in charge of the Shelter, and is governed by a Board of Trustees and managed by a management committee including the on site project manager, David Claassen.