Henry Steel Olcott met Helena Petrovna Blavatsky, a Russian aristocrat of esoteric interests and phenomenal abilities, at a séance in Vermont in 1874. They became close friends who gathered about them others of similar interests. In September 1875 the idea of forming a society was proposed, and a committee, chaired by Olcott, began the organization. On October 30, 1875, Col. Henry Steel Olcott was elected President of the new Theosophical Society, delivering his inaugural address at Mott Hall in New York City on November 17, a date therefore taken as the founding of the Theosophical Society.

On December 18, 1878, Olcott and Blavatsky left New York for India, via England, where they organized a branch of the Society. Arriving in Bombay on February 16, 1879, they traveled around India, lecturing and developing interest in the Theosophical Society. Olcott also soon began work to revive and unify the sects of Buddhism. He is especially remembered in Sri Lanka, where he helped to achieve social justice for the Sinhalese. His Buddhist Catechism, first published in 1881, has been translated into many languages and used as a basic textbook in Buddhist schools.

In December 1882, the two Founders moved the headquarters of the Society from Bombay to Adyar, outside the city of Madras (now Chennai). Although Olcott traveled extensively through India and Sri Lanka as well as around the world, Adyar was his home for the remainder of his life. There, in 1894, he founded a school for the children of poor and destitute families, the Panchamas or Harijans. This school is still run by the Theosophical Society and provides a free education for children from kindergarten through high school.

After a majority of the Lodges in America had severed their connection with the international Society in 1895, Col. Olcott appointed a committee headed by Alexander Fullerton to reorganize the Section. In the following years, Countess Constance Wachtmeister, Annie Besant, C. W. Leadbeater, and Col. Olcott all toured the country, promoting the growth of the Society in the United States until its size became second only to that in India.

In 1906 Olcott attended the American Section's Convention for the last time; during his return to Adyar, he suffered a fall on shipboard, from which he never fully recovered. By December he was confined to his bed, and only with assistance managed to give his last public address at the close of the Adyar convention that year.

Olcott died on February 17, 1907, leaving behind a legacy of immense accomplishment as a beacon to be followed by the succeeding presidents of the Society. He also left a treasure-trove of written works spanning his entire life, most notably his Old Diary Leaves in six volumes that chronicle the founding and early years of the Theosophical Society.

His written works: