The Macarthur Institute of Higher Education was created on 1 July 1983, replacing the Milperra College of Advanced Education, with Dr DC Barr as Principal after having been Acting Principal of Milperra CAE since 1981.
In addition to the Milperra Campus, the Institute had a campus at Campbelltown in the 'Maryfields' Monastery.

The construction of a new Campus on 162 hectares of land to the north of the Campbelltown Regional Centre began in 1984.

The growth and diversification in courses saw the establishment of five Schools: Arts & General Studies, Community and Welfare Studies, Education & Language Studies, Nursing & Health Studies and Business & Technology.  The School of Nursing & Health Studies offered the only nurse education courses in Sydney's South-West and the School of Business & Technology created a first in Australia offering integrated science and commerce courses.

In 1985 the Bachelor of Arts was offered (the first in the South West of Sydney).  New buildings for Nursing were opened on the Milperra Campus and the Regional Entry Test began with the goal of improving the participation rate of students from Sydney's South-West.
Students occupied the first stage of the new campus at Campbelltown in 1986.  An Engineering and Applied Science program began in conjunction with the University of New South Wales and the University of Wollongong.  A Bachelor of Science, a Diploma in Education for Secondary Science and Mathematics teachers and a Bachelor of Business were new courses started.

On November 27, 1987 the Campbelltown campus of the Macarthur Institute was officially opened by the Hon. JS Hawkins, MP, Minister for Employment, Education & Training.  Accredited courses and programs included:  Associate Diploma in applied Science (Manufacturing); Bachelor of Arts (Applied Social Science); Diploma of Teaching, Early Childhood (Phase 1 of the Bachelor of Education-Early Childhood); Bachelor of Arts (Community Languages); Graduate Diploma in Education (Community Languages); and Graduate Diploma in Education (Computers in Education).
In 1988 Macsearch Ltd. was established to market the services of the Institute.  The company was approved by the Corporate Affairs Commission in April.  The Stage 2 project for the Campbelltown campus was completed involving six additional buildings.  New accredited courses included: Bachelor of Arts (Visual Arts); Bachelor of Business (Accounting); Associate Diploma in Small Business Management; Phase 3 of the Bachelor of Education (Early Childhood); and the Bachelor of Health Science (Nursing).  The first masters degree (Masters of Education) was accredited.
On October 31, 1989 the Macarthur Institute of Higher Education became the Univesity of Western Sydney, Macarthur.