Before European settlement, the area now called South Melbourne featured a single hill (where the Town Hall now stands) surrounded by swamps.
The Hill was a traditional social and ceremonial meeting place for Aboriginal tribes.
The area was first settled by Europeans in the 1840s and became known as Emerald Hill.
During the Victorian Gold Rush of 1851 a tent city, known as Canvas Town was established.
Land sales at Emerald Hill began in 1852 and independence from Melbourne was granted in 1855, with Emerald Hill becoming the first municipality other than Geelong, to be declared in the colony (the town's motto ?In Ordine Primum?, means 'first in the field')
The new town developed rapidly. In 1870 Emerald Hill became a borough, by 1872 was proclaimed a Town. The South Melbourne Town Hall was built during this time, and designed in suitable grandeur to evoke the city's booming status. In 1883 and Emerald Hill became a city, changing its official name to South Melbourne.
South Melbourne experienced a decline in the 1950s as Melbourne sprawled outwards. Like many other Melbourne inner city suburbs, during the 1960s the Victorian Housing Commission stepped in and erected several hi-rise public housing towers, the tallest and largest of which, Park Towers is in South Melbourne. The result was an injection of migrants adding to the multicultural flavour of the area.
In the 1980s, South Melbourne experienced one of Melbourne's biggest waves of gentrification. Many of the terrace homes were restored and renovated and a new middle class moved in. As a result of the development of Southbank in the 1990s, Clarendon Street has become one of the highest rental yielding commercial streets in the entire city of Melbourne, attracting many of the residents from the apartment buildings to shop.