In the late 1890s, William George Pye began making scientific instruments while moonlighting from job work at the Cavendish Laboratory in Cambridge. By 1914 W.G. Pye & Co. employed 40 people and manufactured a range of instruments for teaching and research. The early 1920s boom in radio prompted Pye to build their first wireless set in 1922 and similarly in 1937, their first television. By this time, William Pye had sold the company, now renamed Pye Radio Ltd., to C. O. Stanley.

During World War II, a new subsidiary, Pye Ltd, was established for military radio production and after the war this company continued as Pye Telecommunications Ltd eventually becoming the leading UK producer of mobile radio equipment for commercial, business, industrial, police and Government purposes as well as continuing the line in TV and home hi-fi. The 1957 Pye Mozart Hi-Fi amplifier become a minor classic. About this time Pye also developed the first British transistor and were one of the first companies to make an all-transistor hi-fi amplifier.

In 1955 Pye purchased Polygon Records and established the Pye record label, their most prolific artist being Petula Clark (whose father just happened to have been the owner of Polygon records!) Other artists such as Donovan, Sandie Shaw, The Kinks and Status Quo were signed to Pye Records during various stages of their careers.

As the company grew throughout the 1950s, Pye absorbed several smaller manufacturers such as Pamphonic Reproducers, EKCO, and Invicta Radio among others. However, by the 1960s, the influx of cheaper Japanese products began to severely compromise Pye's domestic audio sales and the company sold 60% of its interest to the massive Philips Corporation, increasing this to 100% in 1976.