Until now, the only airline based in Timor was a subsidiary of Singapore Airlines.
The new carrier will fly between Dili and Darwin once a day.
The company will employ Timorese staff, including cabin crew and ground officers, and has been developed by an East Timorese man who fled to Australia as a refugee in 1975.
East Timor President Jose Ramos Horta was in Darwin, in Australia’s Northern Territory, on Monday for the launch.
He said he hoped East Timorese people in the Northern Territory would support the airline.
