In light of the impending closure of Chanute Air Force Base in Rantoul, Illinois, Mayor Katy Podagrosi established the Air Museum Committee in 1989. She concluded: "A museum will not contribute to Rantoul's economic survival; it will contribute to Rantoul's cultural survival."

In 1991, The Air Museum Committee was charged with establishing a governing Foundation and acquiring the funding for a museum. A Board of Directors was formed, foundation by-laws were drafted, and tax-exempt status was granted. A museum director was hired in 1992 and historically significant artifacts were acquired to form the foundation of the museum's collections.

Chanute Air Force Base closed on September 30, 1993.

126,000 square feet in Grissom Hall, Hanger #4 was leased from the Village of Rantoul, and the Director and a dedicated corps of volunteers renovated the space to meet the needs of a fledgling museum. With a loan agreement by Wright Patterson Air Force Base, the museum acquired thirty-four vintage aircraft, the sole and core center of the museum's collections.

The Octave Chanute Aerospace Museum was officially opened in April, 1994.

The museum spent most of its early days seeking funding to meet the demands of daily operations and to comply with the requirements set forth in the Air Force loan agreement for the upkeep of the aircraft. The search for funding continues.

The potential of the Octave Chanute Aerospace Museum is great. The museum is striving toward a foundation-supported environment of fiscal stability, marked professional growth, and ethical responsibility in all aspects of its operations. Not only are the collections improving, but also the educational opportunities, quality of exhibit interpretation, and most importantly the museum's overall accountability.