Sun City was developed by the hotel magnate Sol Kerzner as part of his Sun International group of properties. It was officially opened on 7 December 1979, then located in the Bantustan of Bophuthatswana.
As Bophuthatswana had been declared an independent state by South Africa's apartheid government—although unrecognized as such by any other country—it could provide entertainment such as gambling and topless revue shows, which were banned in South Africa. These factors, as well as its relatively close location to the large metropolitan areas of Pretoria and Johannesburg, ensured that Sun City soon became a popular holiday and weekend destination.
The United Nations had imposed a cultural boycott on South Africa in condemnation of apartheid. To overcome this, Kerzner offered substantial financial incentives to performing artists to use Sun City as a venue. Several famous performers disregarded the boycott and performed at the venue, such as the Beach Boys, Linda Ronstadt, Cher, Millie Jackson, Liza Minnelli, Frank Sinatra (1981), Paul Anka, Status Quo, Rod Stewart (July 1983), and Elton John (October 1983). British rock band Queen's series of performances at the venue in October 1984—in transgression of the boycott—caused considerable controversy, prompting criticism in the British music press, a fine from the Musicians' Union, and Queen's inclusion on the United Nations' blacklisted artists. Following the criticism, Queen strongly defended their decision, citing the fact that they had insisted they played only to desegregated audiences. They also donated to a school for the deaf and blind to prove their philanthropic values. In the late 1980s, Queen's song "We Will Rock You" was used as the sound track to Sun City's 60-second video promo, which was shown as commercial on SABC-TV and also when opening shows in Sun City's Superbowl auditorium.
On 25 October 1980, Sun City's "Superbowl" hosted a racially mixed world heavyweight boxing championship fight between champion American Mike Weaver and challenger South African Gerrie Coetzee. It was won by Weaver by thirteenth-round knockout. The fight was for Weaver's World Boxing Association world heavyweight title.
In 1985, E Street Band guitarist Steven Van Zandt made the venue the focus of his music-industry activist group Artists United Against Apartheid. Forty-nine top recording artists collaborated on a song called "Sun City", in which they pledged they would not perform at the resort because of their opposition to apartheid. Additionally, Simple Minds included the song as part of a live medley on their Live in the City of Light double album in 1987.