The Kumeyaay Native Americans called Southern California home well before the first European, Juan Rodríguez Cabrillo, visited San Diego. In 1542, Cabrillo discovered San Diego Bay, which he named San Miguel. He went ashore in the area now called Point Loma.
Sixty years later, the bay and the present-day area of San Diego were named by Sebastián Vizcaíno. In 1769, Gaspar de Portolà and his expedition founded the Presidio of San Diego (a military post), and on July 16, Franciscan friars Junípero Serra, Juan Viscaino and Fernando Parron raised and blessed a cross, establishing the first mission in upper Las Californias, Mission San Diego de Alcala.
The original town of San Diego was at the foot of Presidio Hill, in the area which is now Old Town San Diego State Historic Park. The location was not ideal, being several miles away from the ocean.

Alta California became part of the United States in 1850, after the U.S. victory in the Mexican-American War and the Treaty of Guadalupe Hidalgo. San Diego, still little more than a village, was incorporated as a city and was named the county seat of the newly established San Diego County.
Alonzo Horton became convinced that the town needed a location closer the water. He bought 960 acres of bayfront land several miles south of the town, in an area that would become downtown San Diego. He built a wharf and began to promote development.
Businesses flocked to New Town and San Diego experienced its first real estate boom. In 1885, a transcontinental railroad route came to San Diego, and by 1890 the population boomed to 16,000.
The U.S. Navy presence began in 1901, with the establishment of the Navy Coaling Station in Point Loma. Camp Kearny was established in 1917, and eventually became the site of Marine Corps Air Station Miramar. Naval Base San Diego and the San Diego Naval Hospital were established in 1922.
San Diego hosted two World's Fairs, the Panama-California Exposition in 1915, and the California Pacific International Exposition in 1935. The expositions left a legacy in the form of Balboa Park and the San Diego Zoo.
Since World War II, the military has played a primary role in the economy. Following the end of the Cold War the military presence diminished considerably. San Diego has since become a center of the emerging biotech industry and is home to telecommunications giant Qualcomm.
The downtown area of San Diego suffered from blight in the 1960s. But since the 1980s, the city has seen the opening of Horton Plaza, the revival of the Gaslamp Quarter, and the building of the San Diego Convention Center.
A recent boom in the construction of condominiums, a gentrification trend in neighborhoods like Little Italy and the opening of Petco Park in the once blighted East Village highlight continued development of downtown.
There have been hiccups along the way. Beginning in 2003, the public became aware of an ongoing pension fund problem that gave the city an estimated $1.4 billion pension fund gap. San Diego also experienced scandal on the Federal level in 2005, when former member of the U.S. House of Representatives, Randy "Duke" Cunningham, resigned after a bribery scandal.
Other recent problems for San Diego have revolved around the city's relationship with the San Diego Chargers and the team's request for an improved football venue. The off-and-on negotiations between the city and the Chargers have led some to speculate that the Chargers will leave San Diego and move to Los Angeles. Club owner Dean Spanos, though, has repeatedly declared his intention to stay in America's Finest City.
That nickname, incidentally, came on the scene in the early 1970s. Richard Nixon, who called San Diego his "Lucky City," had promised to bring the 1972 Republican National Convention to town. But the GOP pulled out at the last minute and moved to Miami. Seeking to salve wounded civic pride, it was then-mayor Pete Wilson who dubbed San Diego "America's Finest City."