In the late 18th century, Spanish explorers entered the Santa Clara Valley, encountering the Ohlone people, including those from the Posolmi village. The Ohlone lived in a sustainable relationship with the land, relying on hunting, fishing, and acorn gathering. Spanish contact began a period of profound change, bringing new goods, religion, and disease. This marked the beginning of European influence in the region's history.

The Mexican government granted Rancho Pastoria de las Borregas to Francisco Estrada. Spanning thousands of acres, the rancho was used for cattle grazing and sheep herding. After Estrada's death, the land was passed to his widow, Inez Castro, and eventually sold to other settlers. The rancho system represented a shift toward large-scale land ownership in the valley.

The San Francisco and San Jose Railroad was extended through Murphy's land, a development that linked the area to regional markets. This transportation access dramatically increased trade and population growth. Murphy granted right-of-way to the railroad on the condition that a passenger stop be built, setting the stage for the later Murphy Station. The railroad became a lifeline for the city's future industrial and agricultural economy.

After the 1906 San Francisco earthquake destroyed its plant, the Joshua Hendy Iron Works moved to a 12-acre site in Sunnyvale. Initially producing mining machinery, the factory became a major wartime supplier of marine engines during World War II. The relocation brought thousands of jobs and transformed Sunnyvale from a farming community into an industrial center. This event laid the groundwork for Sunnyvale's later role in the defense and technology industries.

In a groundbreaking political achievement, Edwina Benner was elected mayor of Sunnyvale, becoming the first female mayor in California. Her leadership during a period of agricultural and industrial transition was notable. She served multiple terms, focusing on civic improvement and modernization. Her election reflected broader social changes in women's political participation.

World War II accelerated Sunnyvale's transformation as canneries and orchards gave way to defense manufacturing. Companies like Joshua Hendy Iron Works and the expansion of Moffett Field drove employment in ship engines, aircraft, and military technology. The shift reshaped Sunnyvale's physical and economic landscape. The city's identity began moving away from farming toward its modern industrial and technological base.

In a controversial urban renewal project, Sunnyvale demolished much of its historic downtown to build the Town Center Mall. While the project aimed to modernize the retail landscape, it erased significant architectural and cultural heritage. The loss of the old downtown remains a point of historical reflection for residents. The mall itself later faced economic struggles, leading to redevelopment in the 21st century.