A mission to establish a funeral service educational institute began in 1932 when leaders in the funeral profession realized the need for a national organization to focus on improving mortuary management. The vision of these foresighted professionals, led by Wilbur M. Krieger, was realized in 1945, when the National Foundation of Funeral Service (NFFS)—now the Funeral Service Foundation (FSF)—was established as an educational trust. A division of NFFS, the National Research Information Center (NRIC) produced two landmark studies, “Attitudes toward Death and Funerals,” conducted by Northwestern University, and “Project Understanding,” conducted by Notre Dame University.

Located in northeastern Illinois until 1997, the former National Foundation of Funeral Service moved to Brookfield , Wisconsin in that year, following the decision of its Board of Trustees to merge operations, as a separate entity, in a transfer to the National Funeral Directors Association (NFDA). Trustees took this action because under NFDA, the largest funeral service organization in the world, the foundation would have stronger administrative power. The foundation was transformed into the Funeral Service Educational Foundation (FSEF), its goal to advance professionalism in funeral service and to enhance public knowledge and understanding through education and research. The former NFFS Beryl L. Boyer Library was also moved to Brookfield (where it is now the central collection of the Howard C. Raether Library).

In 2001, the foundation debuted its Internet website as a national resource for consumers and funeral service professionals. In that year, a Children's Fund was established to begin making grants to improve children's lives.

In 2002, the FSEF Board of Trustees elected to make a strategic move away from the foundation's former education mission, with a new objective of becoming the unifying voice that represents the compassion, generosity, and care of the funeral service profession, through philanthropic endeavors.

The new Funeral Service Foundation (FSF) was created as a public grant making organization that solicits, manages, and distributes funds for charitable work related to and on behalf of funeral service and allied professions. An endowment campaign to provide a permanent funding resource for FSF was announced, with a goal of $5 million. All former FSEF educational programs and the library were transferred to the National Funeral Directors Association in 2003 , and FSF began to provide scholarships to mortuary science school students.

In the midst of two disasters in 2004 and 2005 , the Southeast Asian Tsunami and Hurricane Katrina, FSF established a Disaster Relief Fund to provide grants to support non-profit organizations in affected areas.

By 2006, the foundation's Hand in Hand endowment campaign reached $4 million in pledges, and it began to make grants available from mature funds.

As the charitable voice of funeral service, FSF currently awards numerous scholarships and grants annually to support career and professional development, the support of funeral service and allied professions, public awareness and education, the improvement of children's lives, and disaster relief , all while continuing to fundraise to support these missions.