Cigar industrialist Don Vicente Martinez Ybor contracted with the Tampa Board of Trade on October 5, 1885, to relocate his hand rolled cigar manufacturing business Ybor & Co. to what is now known as Ybor City, FL.¹ Ybor purchased 40 acres of land northeast of Tampa, a fishing village, where he moved his cigar industry operations from Key West. Born in Valencia, Spain in 1818, Ybor originally founded his cigar manufacturing business in Cuba, as "El Principe de Gales" (also known as "Prince of Wales"). He fled Cuba when he faced Spanish arrest after coming under suspicion for providing funds to assist the Cuban rebels in the 1868 Ten Years War.

Ybor sought to move his company from Key West due to labor unrest, including difficulties with conflicts between his Spanish and Cuban workers, as well as transportation problems. The Tampa area would provide Ybor with the promise of a new port, rail transit, and a greater ability to exercise control over labor workforce issues, in part because he could provide his workers with housing. Ybor was influenced by other manufacturers who were forming company towns.

Ybor and his fellow cigar manufacturers, including Ignacio Haya, an owner of the Sanchez and Haya Co., who technically opened the first cigar factory in Ybor City, were allowed complete control over the planning and building of their factories as well as other buildings in the city. Local wetlands needed to be drained for the development. During this time, there was a push towards growth and industrialization, and the wetlands were not valued for their habitat, water storage, and flood controlling properties. By 1910, more than two hundred cigar factories were producing over a million cigars a day. Thousands of Cuban, Italian, Spanish, Eastern European and some Chinese immigrants were drawn to Ybor City, which became known as the “Cigar Capital of the World.”

Ybor, Haya, and other cigar industrialists founded area businesses, including: a streetcar line, grocery stores, apartments, warehouses, gas stations, an insurance company, a road paving service, and Ybor City Brewing Company. Ybor built small houses, known as "casitas" that his workers could purchase at cost as a way of increasing staff retention and improving worker satisfaction. The company town was planned by Don Gavino Gutierrez, a Spanish civil engineer who was hired by Ybor and Haya. Gavino was responsible for bringing Ybor to Tampa and is recognized as the founder and first citizen of Ybor city.

The city was initially settled by Cuban and Spanish immigrants who worked in the cigar factories. Later, Italian, Eastern-European Jewish, and some Chinese immigrants came and established retail shops, restaurants, and other enterprises to service the cigar industry and population of Ybor City. The city residents founded mutual aid societies, newspapers, labor organizations, social and civic organizations, and businesses with a unique Latin culture. For colorful descriptions of what it was like to live in Ybor City during these times, consider reading the books of author Ferdie Pacheco, MD, who chronicled the spirit of the city.

The Great Depression brought about a downturn for the cigar industry, as demand for luxury products like fine cigars dropped. Some factories closed, and the tradition of hand rolling cigars was severely curtailed as factories moved towards modern forms of mechanized production and increased the employment of lower paid female operators in order to reduce costs. Efforts to unionize workers often failed due to discrimination within the labor movement, and factions between worker groups. Many lost their jobs and left the city due to widespread unemployment. The city deteriorated as workers left primarily for New York and Havana. In the 1950s, part of Highway I-4 was built through Ybor City, resulting in a further decline of the neighborhood.

In the 1980s, the city began a slow process of revitalization as an area for artists, moving on to becoming an entertainment district in the 1990s, with historic structures renovated and the area being recognized as a National Historic District, with approximately 950 historic buildings. This district is significant for its importance to Tampa's architectural heritage, as it contains many of the city's best remaining examples of late-nineteenth century and early-twentieth century domestic, religious, commercial, and industrial buildings developed within the context of a company town. Today, Ybor City is a revitalized historic district that celebrates American Hispanic Heritage.