Indigenous Australians have lived in the present-day ACT for at least 20,000 years. The area formed the traditional lands of the Ngambri people and several other linguistic groups. It was incorporated into the Colony of New South Wales with British settlement in 1788, but no white person reached the area until Joseph Wild in 1820. In 1824, Joshua Moore built a homestead named Canberry, whose name was derived from a local Aboriginal language; its meaning is disputed. Further homesteads and stations were established over the course of the 19th century. These were initially large properties used for sheep and cattle grazing, but they were later broken up and subdivided into smaller farms and urban settlements. The oldest gazetted settlement in the ACT is Tharwa, which was proclaimed in 1862.
The Constitution of Australia – which took effect on 1 January 1901 – provided that a new national capital should be built at a site determined by Federal Parliament. It had to be within the state of New South Wales, but at least 100 miles (160 km) away from Sydney. The Seat of Government Act 1908 fixed Canberra as the site of the new capital, and the surrounding region was formally ceded to the federal government on 1 January 1911. It was originally known as the Federal Capital Territory (FCT), adopting its current name in 1938. American architect Walter Burley Griffin won the competition to design the new city, and was appointed to oversee its construction. He was dogged by disputes with the government and the onset of World War I, and was fired in 1921. Multiple planning bodies were established but achieved little, in part due to the Great Depression.
Parliament moved to Canberra in 1927, although government offices were slow to follow. The growth of Canberra and the ACT was slow, with potential residents discouraged by the cold climate and lack of facilities. Development accelerated after World War II, championed by Prime Minister Robert Menzies who regarded the state of the capital as an embarrassment. The National Capital Development Commission was created in 1957 with more power than its predecessors. It ended four decades of disputes over the shape and design of Lake Burley Griffin, the centrepiece of Canberra, with construction completed in 1964. This prompted the development of the Parliamentary Triangle, a core part of Griffin's design, and followed various buildings of national importance were constructed on the lakefront. On average, the population of Canberra increased by more than 50% every five years between 1955 and 1975. More residential land was released through the creation of new town centres in the 1960s and 1970s.
Archæological evidence from the Birrigai rock shelter in Tidbinbilla Nature Reserve indicates habitation dating back at least 21,000 years. It is possible that the area was inhabited for considerably longer, with evidence of an Aboriginal presence in south-western New South Wales dating back around 40,000–62,000 years. Another site of significance in the reserve is the Bogong Rocks shelter, which contains the oldest evidence of Aboriginal occupation at a bogong moth resting site. These insects were an important source of food for the Aboriginal peoples of the Southern Alps and would accumulate by the thousands in caves and rock crevices, where they were collected and later roasted in sand or ashes, and then eaten whole.
Numerous other culturally significant and archæologically notable sites are known across the territory, including shelters, rock art sites, stone artefact scatters, scarred trees and chert quarries. Tidbinbilla Mountain is believed to have long been used for Aboriginal initiation ceremonies.