The city of Yazd has a history of over 3,000 years, dating back to the time of the Median empire, when it was known as Ysatis. The present city name has however been derived from Yazdegerd I, a Sassanid ruler.

The city was a Zoroastrian centre during Sassanid times; after the Arab Islamic conquest of Persia many Zoroastrians fled to Yazd from neighbouring provinces. By paying a levy, Yazd remained Zoroastrian even after its conquest, and Islam only gradually became the dominant religion in the city.

Because of its remote desert location and the difficulty of approach, Yazd had remained largely immune to large battles and the destruction and ravages of war. For instance, it was a haven for those fleeing from destruction in other parts of Persia during the invasion of Genghis Khan. It was visited by Marco Polo in 1272, who remarked on the city's fine silk-weaving industry. It briefly served as the capital of the Muzaffarid Dynasty in the fourteenth century, and was unsuccessfully besieged in 1350−1351 by the Injuids under Shaikh Abu Ishaq. The Friday Mosque (Masjed-e Jameh), arguably the city's greatest architectural landmark, as well as other important buildings, date to this period. During the Qajar dynasty (18th Century AD) it was ruled by the Bakhtiari Khans.