There is no exact date for the founding of Valparaíso. It is said that it was about 470 years ago, when, during the Spanish colonization, a chapel was built, later replaced by a church, around which a hamlet grew up; while the port was provided with a protecting fort, El Castillo San José, built on one of the neighboring hills.

At the beginning of the 19th century, when Chile had become independent and was beginning to develop an important overseas trade, as well as becoming a vital link in the line of communication between Europe and the west coast of South America round Cape Horn, many English, German, and French immigrants arrived. It was these foreigners who molded the shape of an urban development which did not conform to the rigid grid pattern of Spanish cities; they produced growth in the city, and formed its own particular characteristics. Between houses which seem to hang off the hillsides the people move around the city using the narrow streets, steps and ascensores, fifteen of which are still in full use today and continue to be one of the main means of transport for the citizens.

Once the level coastal strip was saturated, building spread up the adjoining hills which surround the bay, giving rise to the present day shape of Valparaíso.

Valparaíso was a prosperous city until the beginning of the 20th century, when it was practically destroyed by an earthquake, while international trade stopped using the port, opting instead for the easier route to connect the Atlantic and Pacific Oceans offered by the opening of the Panama Canal. Today, a significant proportion of its inhabitants cherish the idea that the city will revive after being declared a part of World Cultural Heritage.

On July 2nd 2003, the city of Valparaíso was declared a part of World Cultural Heritage by the United Nations Education, Science and Culture Organization (UNESCO).