Nevada City was originally called Deer Creek Dry Diggins when it was just a mining camp. In the fall of 1849, Dr. A.B. Caldwell opened a general store and the mining camp started resembling a town. The town became Caldwell's Upper Store.

In 1850, the town was looking more like a city, with a cities' problems. The citizens, under Mexican law, elected a mayor, or "Alcalde," to establish and keep order. The new city needed an official name, so, in a canvas hotel at Main and Commercial streets, ballots were taken. The choice of "Nevada" which is Spanish for "Snow Covered" seemed appropriate to the crowd.

On September 9, 1850 California became the 31st state to join the Union. In 1851, Nevada City became the County Seat when Nevada County was formed from a section of Yuba County. By 1856, 2081 votes were cast in the City of Nevada, only Sacramento and San Francisco polled more.
In 1859, Silver was discovered in the Utah Territory. The first samples were assayed (weighed and assessed for value) at Ott's Assay Office in Nevada (City). Many of Nevada's residents headed over the Sierra to search for silver in what became known as the Comstock Silver Rush. Later, in 1864, that part of the Utah Territory was formed into the State of Nevada.

In that year, the word "City" was added to Nevada, to distinguish the two for the benefit of all (particularly the Postal Service.) After the initial gold rush, merchants, bankers and the like came to Nevada City and built homes in the style of the day. This was during the reign of Queen Victoria, and that style of architecture became known as "Victorian". Colonial, Greek Revival, and "California Gothic" styles of architecture are well represented here as well.

Most of Nevada City burned to the ground on several occasions. Two of the most interesting buildings in the downtown area are fire houses that were built with more than utilitarian style. This also accounts for the prevalence of brick buildings featuring iron shutters.

What accounts for the preservation of Nevada City is the economic downturn it faced when the gold mining slowed. By World War II, when the mines in Grass Valley closed, there was not much reason for building or refurbishing of old buildings, and the architecture of the period was spared urban renewal. WPA projects in the post-war period gave Nevada City the art deco facades of the city hall and court house.

In the late 1960s the residents and visitors of the area started recognizing the remarkable charm of the town. City ordinances were revised to disallow the historically inaccurate and downright tacky new storefronts and signage, and the city buried all the power lines in the downtown area.

Gas lights made from original 1800s molds were placed along Broad Street, and the Nevada Theatre was restored. Private restorations followed, and the result is the beautiful little city of Nevada City.

Nevada City is not a museum. It is a hub of activity. Business, arts, sports, and entertainment of every variety occur on and around the streets of the town. There are lots of places to stay, first rate restaurants, and events that draw visitors from far and near.