The first records referring to Kungsbacka as a town date from the 15th century, when it was part of Denmark. By the time it was recognised as part of Sweden (1658), the river running through the town, on which some transportation of goods took place, was almost completely overgrown and despite pleas to restore its function, this did not occur. Some trade still took place from the coast, but the town's significance as a place of naval commerce lessened over the centuries. Today, it is however the home of over 2,000 businesses, and the river is still running through it.
A devastating fire in 1846 did however destroy the town centre, sparing only a little red wooden hut which is still standing today. In late 2006 another major fire affected the town centre, and construction works are currently ongoing to restore the loss of the wooden buildings.