The company was founded in 1983 by semiconductor veterans Rodney Smith, Robert Hartmann, James Sansbury, and Paul Newhagen with $500,000 in seed money. The name of the company was a play on "alterable", the type of chips the company created. In 1984, the company formed a long-running design partnership with Intel, and 1988, became a public company via an initial public offering (IPO). In 1994, Altera acquired the PLD business of Intel for $50 million.[5]

Altera offered a publicly available ASIC design flow based on HardCopy ASICs, which transitioned an FPGA design, once finalized, to a form which is not alterable. This design flow reduced design security risks as well as costs for higher volume production. Design engineers could prototype their designs in Stratix series FPGAs, and then migrate these designs to HardCopy ASICs when they were ready for volume production.

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