The company was a collaboration between Italian designer Adriano Goldschmied and Korean-American manufacturer Yul Ku, whose Koos Manufacturing had produced denim for brands including Gap, J.Crew and Banana Republic. Goldschmied left in 2004, selling his share and namesake to Ku. Ku's son Samuel introduced the brand's boyfriend jean in 2008, sparking a resurgence.
Sustainability has been the brand's defining feature since 2010 — solar panels, energy-efficient washers, laser distressing and, from 2019, a water-recycling system that lets it run almost entirely on recycled water. AG manufactures in-house and has collaborated with Alexa Chung on a 1960s-and-70s-inspired line.