The club was formed in 1915 following the merger of Irún Sporting Club and Racing Club de Irún. The former was founded in 1902 as Irún Foot-Ball Club, changing its name in 1907. The latter, formed in 1908, had already won the Spanish Cup in 1913 beating Athletic Bilbao 1–0 in a replayed final.
The club was briefly known as Unión Club Irún before Alfonso XIII gave the club royal approval. During the Second Spanish Republic the club reverted to this name. Real Unión subsequently won the domestic cup three further times, beating Real Madrid in 1918 and again in 1924. In 1927 they defeated Arenas Getxo in the only all-Basque final to date, also being runners-up in 1922, losing 5–1 to FC Barcelona. The club were relegated from the top flight in 1932.
In 1920, when Spain made their international debut at the Olympic Games, the club provided the squad with three players—Egiazabal, Vázquez and Arabolaza. Another Real Unión player, René Petit, took part in the same Olympic Games with France. In the 70s and 80s, Spanish internationals Javier Irureta and Roberto López Ufarte began their career with the club.