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The town was founded in the postbellum era by the Bessemer Land and Improvement Company, named after Henry Bessemer and owned by coal magnate Henry F. DeBardeleben. He had inherited Daniel Pratt's investments. The mayor and councilmen voted to incorporate the city of Bessemer on September 9, 1887. Located 16 miles southwest of Birmingham, Bessemer grew rapidly and its promoters believed that it might overtake the other city in economic power.

Given the iron ore, coal and limestone deposits in the area, the city became a center of steelmaking from about 1890 through the 20th century. It attracted rural migrants from across the South, as well as European immigrants. By the 1950s, the city's population was majority black.

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