The street has been a main thoroughfare since at least medieval times, and in the Middle Ages was known as "the road to Reading" or "the way from Colnbrook". Around 1611 or 1612, a Robert Baker acquired land in the area and prospered by making and selling piccadills. Shortly after purchasing the land, he enclosed it and erected several dwellings, including his home, Pikadilly Hall. What is now Piccadilly was named Portugal Street in 1663 after Catherine of Braganza, wife of Charles II, and grew in importance after the road from Charing Cross to Hyde Park Corner was closed to allow the creation of Green Park in 1668. Some of the most notable stately homes in London were built on the northern side of the street during this period, including Clarendon House and Burlington House in 1664. Berkeley House, constructed around the same time as Clarendon House, was destroyed by a fire in 1733 and rebuilt as Devonshire House in 1737 by William Cavendish, 3rd Duke of Devonshire. It was later used as the main headquarters for the Whig party. Burlington House has since been home to several noted societies, including the Royal Academy of Arts, the Geological Society of London and the Royal Astronomical Society. Several members of the Rothschild family had mansions at the western end of the street. St James's Church was consecrated in 1684 and the surrounding area became St James Parish.
The Old White Horse Cellar, at No. 155, was one of the most famous coaching inns in England by the late 18th century, by which time the street had become a favourable location for booksellers. The Bath Hotel emerged around 1790, and Walsingham House was built in 1887. Both the Bath and the Walsingham were purchased and demolished, and the prestigious Ritz Hotel built on their site in 1906. Piccadilly Circus station, at the east end of the street, was designed by Charles Holden and built between 1925 and 1928. It was the first underground station to have no above-ground premises; the station is only accessible by subways from street level. The clothing store Simpson's was established at Nos. 203–206 Piccadilly by Alec Simpson in 1936. During the 20th century, Piccadilly became known as a place to acquire heroin, and was notorious in the 1960s as the centre of London's illegal drug trade. Today, it is regarded as one of London's principal shopping streets. Its landmarks include the Ritz, Park Lane, Athenaeum and Intercontinental hotels, Fortnum & Mason, the Royal Academy, the RAF Club, Hatchards, the Embassy of Japan and the High Commission of Malta.
Piccadilly has inspired several works of fiction, including Oscar Wilde's The Importance of Being Earnest and the work of P. G. Wodehouse. It is one of a group of squares on the London Monopoly board.
The street has been part of a main road for centuries, although there is no evidence that it was part of a Roman road, unlike Oxford Street further north. In the Middle Ages it was known as "the road to Reading" or "the way from Colnbrook". During the Tudor period, relatively settled conditions made expansion beyond London's city walls a safer venture. Property speculation became a lucrative enterprise, and developments grew so rapidly that the threat of disease and disorder prompted the government to ban developments. Owing to the momentum of growth, the laws had little real effect.
A plot of land bounded by Coventry, Sherwood, Glasshouse and Rupert streets and the line of Smith's Court was granted by Elizabeth I to William Dodington, a gentlemen of London, in 1559–60. A year or so later it was owned by a brewer, Thomas Wilson of St Botolph-without-Aldgate. The grant did not include a small parcel of land, 1 3⁄8 acres in area, on the east of what is now Great Windmill Street. That plot may have never belonged to the Crown, and was owned by Anthony Cotton in the reign of Henry VIII. John Cotton granted it to John Golightly in 1547, and his descendants sold it to a tailor, Robert Baker, in c. 1611–12. Six or seven years later, Baker bought 22 acres of Wilson's land, thanks largely to money from his second marriage.