Chai was formed in 2012 in Nagoya, Aichi Prefecture, by twin sisters Mana and Kana, alongside Yuna and Yuuki. Mana, Kana, and Yuna are all from Nagoya, and were in the same class at high school. The three were members of the light music club at their high school, performing covers of musicians such as Tokyo Jihen and Aiko. Yuna introduced the other band members to Japanese music that did not easily fit into the traditional definition of "J-Pop", such as the band Cero or Kimyō Reitaro.
After the girls graduated and went to university, Mana became friends with Yuuki (originally from Gifu Prefecture, who had moved to Nagoya), and asked the four friends to form a band. The band's name comes from Russian tea (known as chai). Kana drank the tea with jam with her Russian literature professor at a Russian restaurant, which she thought was cute.
At first, Chai performed mostly around Aichi Prefecture, but eventually moved to playing venues around Tokyo. The band started releasing singles independently in 2013, and held a tour of central Japan in the summer holidays. Their first large concert was performed at Zepp Nagoya, when the band were finalists in a college band competition.
The band's debut extended play Hottaraka Series was released in August 2015, exclusively at digital retailer Ototoy and as a tour exclusive CD. In August 2016, the EP was released to streaming services globally, with the song "Gyaranboo" reaching number 36 on Spotify's UK top 50 chart.
The band moved to Tokyo in 2016 in order to focus on becoming full-time musicians. In October, Chai were signed to Sony Music Japan after winning a competition in order to find acts to perform at Japan Nite at the SXSW festival in Austin. In December, Hottaraka Series was given a nationwide release. After their US SXSW tour in March 2017, the band released their second EP, Homegoro Series, distributed through Otemoyan Record, a record label imprint founded by Chai.
Chai released their debut studio album Pink in October 2017, reaching number 41 on Oricon's albums chart (however, it was the fourth highest selling independent release on the week). Pink was well received by critics, being chosen as one of the 10 finalists at the 2018 CD Shop Awards, an award chosen by record store staff from across Japan. In February, Pink was given a US release by Burger Records, who signed Chai after being impressed by their music video for "Boyz Seco Men".
Chai had decided from very early in their careers to pursue music globally, and they considered it strange that many Japanese musical acts only focused on selling music domestically. The band completed their second tour of the US in March. In the UK, Chai were signed to Heavenly Recordings, and toured the country in October as a support act for Superorganism. In February 2019, the band released their second studio album, Punk.
The band were signed to US indie label Sub Pop in October 2020. In 2020, Chai collaborated with Gorillaz and JPEGMAFIA on "MLS," a track on the Gorillaz album Song Machine, Season One: Strange Timez. The song was co-written by Mana and Kana