Thunder Bay's central location in the centre of the continent and at the head of the Great Lakes made it a natural meeting and trading site as far as the Paleo-Indian civilization 11,000 years ago.

Probably first occupied by French fur traders as early as 1678, the site where Thunder Bay now sets was permanently settled only after the birth of the towns Port Arthur and Fort William in the 19th century.

Fort William originated shortly after 1800, when the North West Company built a fur-trapping fort at the mouth of the Kaministiquia River.

Port Arthur, the Hill City, developed in the 1850s as a silver-mining settlement on the hummocks a few miles to the north. Both communities prospered in the early 1870s from silver strikes in the vicinity. An intense rivalry that existed between the two for some time was resolved with the unification of their harbor facilities in 1906.

Thunder Bay began a period of extraordinary growth as a result of transcontinental railway building and the western wheat boom.

• The Canadian Pacific Railroad double-tracked its Winnipeg-Thunder Bay line.
• The Canadian Northern Railway established facilities at Port Arthur.
• The Grand Trunk Pacific Railway began construction of its facilities at the Fort William Mission in 1905
• The federal government began construction of the National Transcontinental Railway.
• Grain elevator construction boomed as the volume of grain shipped to Europe increased.

The boom came to an end in 1913-14 aggravated by the First World War, but a war time economy emerged with the making of munitions and ship-building.

The forest products industry has always played an important role in the Thunder Bay economy from the 1870s. Logs and lumber were shipped primarily to the United States. In 1917 the first pulp and paper mill was established in Port Arthur. It was followed by a mill at Fort William in 1920. Eventually there were four mills operating.

Plans to amalgamate the twin cities began in the 1950s, and the merger created the city of Thunder Bay in 1970.

Thunder Bay is Ontario's largest port, and Canada's sixth largest port, rated by tonnage of cargo. It is one of the largest grain handling ports in the world, with grain elevators having an estimated 2 million tons of storage capacity. The forest sector companies presently account for roughly 5.4% of Canada's total forest-based sales output.