Native Americans lived in the Sacramento area for over 10,000 years before Europeans arrived. In the early 1800s, Spanish explorer Gabriel Moraga arrived here, naming the Sacramento River and its valley after the Spanish word for "sacrament." Swedish settler John Sutter arrived in 1839, building a trading post and establishing Sutter's Fort.

In 1848, James W. Marshall found gold at Sutter's Mill about 50 miles northeast of the fort, and the California Gold Rush was on. Sutter's son John Jr. established the town of Sacramento, hiring an engineer to lay out its streets in the area just east and south of where the American River meets the Sacramento River.

Sacramento adopted its city charter in 1849, and the state legislature recognized it in 1850, making Sacramento California's oldest incorporated city. Despite floods, fires and cholera epidemics, the city grew quickly to 10,000 people. In 1854, the State of California made Sacramento its permanent state capital, but governmental operations did not move here until 1855.

Begun in 1869 and its design influenced by United States Capitol in Washington, DC, the Renaissance Revival style California State Capitol building was completed in 1874.

Because of it strategic location, Sacramento soon became the western end of the Pony Express. Construction of the First Transcontinental Railroad began in Sacramento in 1863, built by the "Big Four" of western railroading: Leland Stanford, Mark Hopkins, Collis P. Huntington and Charles Crocker. Together with its strategic location on two important rivers, the railroad helped make Sacramento a center of transportation and commerce.

Oddly, the Sacramento governor's mansion went unoccupied for many years after Ronald Reagan left office in 1967, with many state offices related to the governor located in Los Angeles and the California Supreme Court sitting in San Francisco. Nevertheless state government remains Sacramento's largest employer.