Before its incorporation in 1796 under the Franciscan Mission San Jose, located in what is now the southern part of Fremont, the Livermore area was home to some of the Ohlone (or Costanoan) native people. Each mission had two to three friars and a contingent of up to five soldiers to help keep order in the mission and to help control the natives. Like most indigenous people in California, the natives in the vicinity of Mission San Jose were mostly coerced into joining it, where they were taught Spanish, the Catholic religion, singing, construction, agricultural trades and herding—the Native Californian people originally had no agriculture and no domestic animals except dogs. Other tribes were coerced into other adjacent missions. The Mission Indians were restricted to the mission grounds where they lived in sexually segregated "barracks" that they built themselves with padre instruction. The population of all California missions plunged steeply as new diseases ravaged the Mission Indian populations—they had almost no immunity to these "new to them" diseases, and death rates over 50% were not uncommon.

The Livermore-Amador Valley after 1800 to about 1837 was primarily used as grazing land for some of the Mission San Jose's growing herds of mission cattle, sheep and horses. The herds grew wild with no fences and were culled about once a year for cow hides and tallow—essentially the only money-making products produced in California then. The dead animals were left to rot or feed the California grizzly bears which then roamed the region. The secularization and closure of the California missions, as demanded by the government of Mexico, from 1834 to 1837 transferred the land and property the missions claimed on the California coast (about 1,000,000 acres (400,000 ha) per mission) to about 600 extensive ranchos. After the missions were dissolved, most of the surviving Indians went to work on the new ranchos raising crops and herding animals where they were given room and board, a few clothes and usually no pay for the work they did—the same as they had had while working in the missions. Some Indians joined or re-joined some of the few surviving tribes.^{[citation needed]}

The about 48,000-acre (19,000 ha) Rancho Las Positas grant, which includes most of Livermore, was made to ranchers Robert Livermore and Jose Noriega in 1839. Most land grants were given with little or no cost to the recipients. Robert Livermore (1799-1858) was a British citizen who had jumped from a British merchant sailing ship stopping in Monterey, California, in 1822. He became a naturalized Mexican citizen who had converted to Catholicism in 1823 as was required for citizenship and legal residence. After working for a number of years as a majordomo (ranch foreman), Livermore married on 5 May 1838 the widow Maria Josefa de Jesus Higuera (1815–1879), daughter of Jose Loreto Higuera, grantee of Rancho Los Tularcitos, at the Mission San José. Livermore, after he got his rancho in 1839, was as interested in viticulture and horticulture as he was in cattle and horses, despite the fact that about the only source of income was the sale of cow hides and tallow. In the early 1840s he moved his family to the Livermore valley to his new rancho as the second non-Indian family to settle in the Livermore valley area, and after building a home he was the first in the area in 1846 to direct the planting of vineyards and orchards of pears and olives. Typical of most early rancho dwellings, the first building on his ranch was an adobe on Las Positas Creek near the western end of today's Las Positas Road. After the Americans took control of California in 1847 and gold was discovered in 1848, he started making money by selling California longhorn cattle to the thousands of hungry California Gold Rush miners who soon arrived. The non-Indian population skyrocketed, and cattle were suddenly worth much more than the $1.00-$3.00 their hides could bring. With his new wealth and with goods flooding into newly rich California, in 1849 Livermore bought a two-story "Around the Horn" disassembled house that had been shipped about 18,000 miles (29,000 km) on a sailing ship around Cape Horn from the East Coast. It is believed to be the first wooden building in the Livermore Tri-Valley.^{[citation needed]}

During the Gold Rush, Livermore's ranch became a popular "first day" stopping point for prospectors and businessmen leaving San Francisco or San Jose and headed for Sacramento and the Mother Lode gold country. Most horse traffic went by way of Altamont Pass just east of Livermore. Robert Livermore was a very accommodating host and welcomed nearly all that stopped by with lodging and meals.^{[citation needed]}

Robert Livermore died in 1858 and was buried at Mission San Jose before the establishment of the town that bears his name. His ranch included much of the present-day city. The town of Livermore, named in honor of Robert Livermore, was platted and registered on November 4, 1869 as a railroad town by William Mendenhall, who had first met Livermore while marching through the valley with John C. Fremont's California Battalion in 1846 as they were recruited to occupy the surrendering Californio towns captured by the U.S. Navy's Pacific Squadron.

California became the 31st state in 1850 when California's non-Indian population jumped from about 8,000 in 1846 to about 120,000 in 1850 as shown in a corrected 1850 U.S. California Census. California had enough population and enough wealth in 1850 that they bypassed the territorial status of most other states and were allowed to more or less choose their own (large) boundaries.

The Livermore Ranch post office, in Robert Livermore's home, operated from 1851 to 1853. The first significant settlement in the valley was Laddsville, on what is now Junction Avenue, which grew up around the hotel established by Alphonso Ladd in 1864. The official U.S. post office in Livermore opened in 1869. The original Western Pacific Railroad Company in September 1869 completed its railroad connection from Alameda Terminal to Sacramento over the nearby Altamont Pass in the east and Niles Canyon on the west with a stop on the land donated by William M. Mendenhall, who in November 1869 founded the town of Livermore adjacent to the station; and the railroad greatly accelerated town growth. Before the railroad arrived, there was no town called Livermore, only Laddsville, which was a small settlement of about 75. By 1870 the Western Pacific had been absorbed by the Central Pacific Railroad as part of the First Transcontinental Railroad. Central Pacific was later acquired by the Southern Pacific Railroad and then the Union Pacific Railroad, which owns the tracks through town today, although these are primarily the tracks of the "second" Western Pacific Railroad that was founded in 1903 and absorbed into the UP in 1983.^{[citation needed]}

Private grade schools were operating in Livermore from the 1860s on. The Livermore Collegiate Institute was founded in 1870, and the Union High School (later called Livermore High) graduated its first class of students in 1896. Petroleum was discovered near Livermore and become a valuable asset. Extensive coal deposits were mined near Corral Hollow by the Livermore Coal Company. In September 1871 Laddsville mostly burned down, and the people rebuilt their homes and businesses nearer the railroad in what is now downtown Livermore. Until 1875 the townspeople enjoyed bull fights in a small bullring on many Sundays, and on other occasions a captured grizzly bear might be pitted against a longhorn bull. Apparently, roping a grizzly was thought then to be a great sport. As the town grew there were a fire company, churches, a bank, and a library that were formed by 1876. Livermore was officially incorporated by the state as a city on April 1, 1876, its original city limits being the line a block north of 1st Street on the north and Livermore Avenue (then Lizzie Street) on the east. The part of the west side north of 5th Street was bounded by Q Street, and the part of it south of 5th Street by I Street. The part of the south side east of I Street was bounded by 6th Street, and the part of it west of I Street by 5th Street.

During Livermore's early years, it was well known for large hotels that graced the downtown street corners, before new buildings replaced them. Livermore after the 1880s is also notable for the Wente Vineyards, Concannon Vineyard, Cresta Blanca Winery and many other wineries. Since it has a Mediterranean climate, gravelly soil, warm days and cool nights, it was a good location to grow wine grapes. By 1880 the extensive winter wheat and hay crop lands were being replaced by vineyards. Extensive chromite deposits were found and exploited for a time. In 1885, the Remillard Brick Company was producing an extensive line of bricks and employing over 100 men. A telephone line connected Livermore to Arroyo Valley by 1886, and electric lights were introduced by 1889. By 1890 Livermore had over 20 miles (32 km) of streets. Livermore originally had a Boot Hill called the Old Knoll Cemetery.

In 1909, the Livermore Carnegie Library and Park opened after taking advantage of a Carnegie library grant. As the city grew and larger libraries were needed, other libraries were built, and the original site was converted into a historic center and park.

In 1942, the U.S. government bought 692 acres (280 ha) of ranch land, bounded by Vasco and Greenville roads and East Avenue, and built the Livermore Naval Air Station. The primary mission of the base was to train Navy pilots. This facility operated until it was decommissioned in 1946 after the end of World War II. On 5 January 1951, the Bureau of Yards and Docks, U.S. Navy, formally transferred the former NAS Livermore in its entirety to the Atomic Energy Commission (AEC) for use by the University of California's Radiation Laboratory. In 1952, the government established Lawrence Livermore National Laboratory (LLNL), named after famous physicist Ernest O. Lawrence, as the site of a second laboratory for the study of nuclear energy like the research being done at the Los Alamos National Laboratory. The laboratory was run by the University of California. Edward Teller was a co-founder of LLNL and was both its director and associate director for many years. In 1956, the California campus of Sandia National Laboratories opened across East Avenue from LLNL. Both LLNL and Sandia are technically on U.S. government property just outside the city's jurisdiction limits, but with employment at LLNL at about 6,800 and Sandia/California at about 1,150 they are Livermore's largest employers. In 2004, Cornerstone Fellowship remodeled and moved into former indoor soccer facility, making it the largest indoor auditorium venue in the Tri-Valley, with weekly attendance in the thousands.

For pictures of early Livermore, check the Livermore Heritage Guild photo site.

The 2010 United States Census reported that Livermore had a population of 80,968. The population density was 3,216.1 people per square mile (1,241.8/km²). The census reported that 80,482 (99.4% of the population) lived in households, 389 (0.5%) lived in non-institutionalized group quarters, and 121 (0.1%) were institutionalized.

According to the latest census information, Livermore is the third wealthiest midsize (between 65,000 and 249,999 people) city in the nation. In 2005, the median household income in Livermore was $96,632, which ranked it the third highest-income midsize city, behind only the California cities of Newport Beach ($97,428) and Livermore's western neighbor, Pleasanton ($101,022).

There were 29,134 households, out of which 11,238 (38.6%) had children under the age of 18 living in them, 17,058 (58.6%) were opposite-sex married couples living together, 2,834 (9.7%) had a female householder with no husband present, 1,407 (4.8%) had a male householder with no wife present. There were 1,584 (5.4%) unmarried opposite-sex partnerships, and 206 (0.7%) same-sex married couples or partnerships. The population age profile was spread out, with 20,636 people (25.5%) under the age of 18, 6,176 people (7.6%) aged 18 to 24, 22,530 people (27.8%) aged 25 to 44, 23,284 people (28.8%) aged 45 to 64, and 8,342 people (10.3%) who were 65 years of age or older. The median age was 38.3 years. For every 100 females, there were 98.6 males. For every 100 females age 18 and over, there were 96.9 males. Of 5,997 households (20.6%) were made up of individuals, and 2,099 (7.2%) had someone living alone who was 65 years of age or older. The average household size was 2.76. There were 21,299 families (73.1% of all households); the average family size was 3.19. There were 30,342 housing units at an average density of 1,205.2 per square mile (465.3/km²), of which 29,134 were occupied, of which 20,399 (70.0%) were owner-occupied, and 8,735 (30.0%) were occupied by renters.

The homeowner vacancy rate was 1.5%; the rental vacancy rate was 4.8%. 56,967 people (70.4% of the population) lived in owner-occupied housing units and 23,491 people (29.0%) lived in rental housing units.