It was founded in 1391 by Wenceslas Kriz (known as 'the Merchant'), and John of Milheim, and taught solely in the Czech vernacular, thus breaking with German domination of the Medieval Bohemian church. The building was never officially called a church, only a chapel, though it could contain 3,000 people; indeed, the chapel encroached upon the parish of Sts. Philip and James, and John of Milheim paid the pastor of that church 90 grossi as compensation. Hus became a rector and a preacher in March 1402. After Hus's excommunication in 1412, the Pope ordered the Bethlehem chapel to be pulled down, although this action was rejected by the Czech majority on the Old Town council. After Hus's death, he was succeeded by Jacob of Mies.
In the 17th century, the building was acquired by the Jesuits. It fell into disrepair and in 1786 it was demolished; in 1836–1837 an apartment building was built in its place. Under the Czechoslovakian communist regime the building was restored by the government to its state at the time of Hus. Most of the chapel's exterior walls and a small portion of the pulpit date back to the medieval chapel. The wall paintings are largely from Hus's time there, and the text below is taken from his work De sex erroribus, and contrast the poverty of Christ with the riches of the Catholic Church of Hus's time.
- Spinka, Matthew. John Hus: A Biography. 1968, Princeton UP. p. 47
- Spinka, p. 47.
- Spinka, pp 162-163
- Spinka, pp. 48-49
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