The Attakapas Native Americans inhabited this area at the time of the first European encounter. French colonists founded the first European settlement, Petit Manchac, a trading post along the Vermilion River. In the mid-to-late eighteenth century, numerous Acadian refugees settled in this area, after being expelled from Canada after Great Britain defeated France in the Seven Years' War. They intermarried with other settlers, forming what became known as Cajun culture, which maintained use of the French language and adherence to the Roman Catholic Church.

Jean Mouton, an Acadian settler, donated land to the Catholic Church for construction of a small Catholic chapel at this site. In 1824, this area was selected for the Lafayette Parish seat and was named Vermilionville, for its location on the river. In 1836, the Louisiana Legislature approved its incorporation.

The area was initially developed by Europeans for agriculture, primarily sugar plantations, which depended on the labor of numerous enslaved Africans and African Americans. They made up a large percentage of the antebellum population. According to U.S. Census data in 1830, some 41% of the population of Lafayette Parish was enslaved. By 1860, the enslaved population had increased to 49.6%. Some free people of color lived in Lafayette Parish, as well; they made up 3%, to a low of 2.4% between 1830 and 1860.^{[citation needed]}

In 1884, Vermilionville was renamed for General Lafayette, a French aristocrat who had fought with and significantly aided the Continental Army during the American Revolutionary War. The city and parish economy continued to be based on agriculture into the early 20th century. After the Civil War, most of the labor was done by freedmen, who worked as sharecroppers. From the 1930s, mechanization of agriculture began to reduce the need for farm workers.

In the 1940s, after oil was discovered in the parish, the petroleum and natural gas industries expanded to dominate the economy.

Lafayette is considered to be the center of Acadiana, the area of Cajun culture in the state. It is also a center of Louisiana Creole culture. The Cajun culture developed among settlers here over the decades and centuries following the relocation of Acadians after their expulsion by the British. A strong Louisiana Creole influence also is in the area, as this mixed-race population became landowners and businesspeople.

Lafayette is named after Marquis de Lafayette. Little is known about early settlements or if the area had a different name prior to European colonization.

The U.S. Census Bureau's 2019 American Community Survey determined 126,199 people lived in the city limits, and 244,390 within the consolidated city–parish. The 2010 U.S. census reported 120,623 people, 43,506 households, and 27,104 families were residing in the city proper, up from 94,440 in the 1990 United States census. The growth of Lafayette and its metropolitan area's population from the later 20th and earlier 21st century has been attributed to the oil and gas industry, the University of Louisiana at Lafayette, and Acadiana tourism.

Per the American Community Survey's 2019 estimates program, the city proper's age distribution was 21,104 under 15; 20,835 aged 15 to 24; 45,707 aged 25 to 54; and 38,553 aged 55 to 85 years and older. The consolidated city–parish's age distribution was 48,548 under 15; 132,872 aged 15 to 54; and 62,970 aged 55 to 85 years and older. In 2019, Lafayette had a median age of 37.6 and the consolidated city–parish 35.9. For every 100 females there were 88.3 males in the city proper limits and 93.1 males per 100 females for the consolidated area.

There were 59,431 housing units for the city and 105,067 for the consolidated city–parish in 2019. Lafayette proper had an owner-occupied housing rate of 56.6% and the parish had an owner-occupied housing rate of 64.8%. Owner-occupied housing units had a median value from $185,300 to $195,400. Median homeowner costs with a mortgage were estimated from $1,362 to $1,420. Lafayette Parish had an estimated 1,162 building units in 2019. In 2019, the median household income was $56,999 for the parish area and $51,264 for the city proper. The median rent was from $870 to $890.

In 2010, 84.2% of the population over the age of five spoke only English at home, while 11.5% of the population spoke French.

Of the population in 2019, 62.5% were non-Hispanic white, 29.6% Black or African American, 0.3% American Indian or Alaska Native, 2.7% Asian, 1.4% two or more races, and 3.5% Hispanic or Latin American of any race. The consolidated area of Lafayette 65.2% non-Hispanic white, 26.6% Black or African American, 0.3% American Indian or Alaska Native, 1.8% Asian, 0.3% some other race, 1.0% two or more races, and 4.6% Hispanic or Latin American of any race. The largest single Hispanic or Latin American group overall were Mexican Americans.

The 2010 American Community Survey determined the racial makeup of the city was 64.1% White, 29.1% African American, 0.2% Native American, 2.5% Asian, and 0.8% from two or more races. Hispanics or Latinos of any race were 3.2% of the population. At the 2000 U.S. census, 68.50% were White, 28.25% Black or African American, 0.25% Native American, 1.42% Asian, 0.2% Native Hawaiian and other Pacific Islander, 0.58% some other race, 0.98% two or more races, and 1.88% Hispanic or Latin American.

In common with Louisiana's religious demographic as part of the Bible Belt, the Lafayette consolidated city–parish and metropolitan area are majority religious (78.6% and 71%), dominated by Christianity. As of 2021, the Catholic Church was the single largest Christian denomination (46.4%), and Protestants were the largest collective Christian group. Among Protestant Christians, Evangelical Protestantism was the largest transdenominational body and historically Black or African American churches were the second largest. Mainline Protestantism remained a minority.

Owing in part to Spanish and French colonialism and missionary work, Christians are primarily served by the Latin Church's Roman Catholic Diocese of Lafayette in Louisiana. The Roman Catholic Diocese of Lafayette in Louisiana was founded in 1918 and its see is the Cathedral of Saint John the Evangelist.Baptists were the second largest individual Christian denomination (17.8%). The most prominent Evangelical Baptist denomination in the Lafayette area as of 2021 is the Southern Baptist Convention. The National Baptist Convention, USA, Inc. and National Baptist Convention of America were the largest historically Black or African American Baptist denominations. Independent Baptist churches also have a significant presence in the metropolitan area.

Pentecostals made up the third largest Christian community in Lafayette (3.6%), and have been primarily served by the Church of God in Christ and Assemblies of God USA. Following, Methodists, Episcopalians or Anglicans, Mormons, Lutherans, and Presbyterians formed the remaining mainstream Christian population of Lafayette and its metropolitan area. Christians of other faiths including the Jehovah's Witnesses, united and uniting churches, and Independent Sacramental Movement collectively formed 5.6% of the population.

In 2021, Judaism and Islam were tied as the second largest non-Christian religions within Lafayette and its metropolitan area (0.1% each). Jews began immigrating to the area in the 1800s, and one of Louisiana's oldest continuously-operated synagogues (Temple Shalom) has been present in the city since 1869. The historic synagogue of Temple Shalom originally functioned as an Orthodox Jewish congregation before joining the Reform Judaism movement. Lafayette's Jewish community has assisted in economic and cultural development of the area since their arrival.