The "Haus- und Verdienstorden des Herzogs Peter Friedrich Ludwig" was instituted by Grand Duchy Decree of November 27th, 1838 by Grand Duke Paul Friedrich August I von Oldenburg. He named the decoration after his father Duke Peter Friedrich Ludwig.
On February 11th, 1856, Grand Duke Nicolaus Friedrich Peter II instituted to all classes the possibility to award them with 'swords' or 'swords on a ring'. The classes with breast star awarded with swords on a ring received from January 17th, 1879 onwards two crossed swords above the breast star.
On January 17th, 1902, Grand Duke Friedrich August decided that when promoted to a higher grade, the recipient was allowed to keep wearing lower grades when they were awarded during war.
On January 17th, 1903 it was decided no longer to make the decorations from gold but from gold plated silver.
During the First World War is was decided that in order to receive the swords to a certain grade, the recipient had to be awarded the Prussian Iron Cross 1st Class and a Prussian Order with Swords or the Pur le Merite. Also the awardee had to be a citizen of Oldenburg or had to be part of one of the Oldenburg troops. Gran Duke Friedrich August instituted an oak leaf to be able to award to the decoration on October 21st, 1918. On November 11th, 1918 the decoration was no longer to be a state decoration and became a house decoration of the Duchy family.