The team of Karpaty was founded on January 18, 1963. In 1962 Selmash Lvov won the championship and cup of the Lvov Region and, thus, obtained the rights to participate in the Soviet Class B championship (Soviet First League). However, in 1963 the Football Federation of USSR conducted another reorganization in football national tournaments creating the Second Group of Class A and Class B became the third tier where a berth was reserved for a team from Lviv. At that time the best city team was SKA Lvov, players of which did not stay there for long leaving it at the end of their military service, while the best would be drafted to CSKA Moscow. In light of that the city administration decided to create independent from military a civilian team.
In December 1962 in the building of Regional Council of trade unions (prospekt Shevchenka) the head of the council and the regional federation Hlib Klymov gathered coaches of Silmash Yuri Zubach (former player of Ukraina Lwów) and Vasyl Solomonko as well as the director of city plant "Lvivsilmash" Ivan Kalynychenko to discuss the new name for a club. The name Silmash was recognized as inadequate for participation on such level. Among variants were Spartak, Dynamo, Halychyna, while at the end they agreed upon the regional toponym (Carpathians) Karpaty which would the best to represent the region.
In the Soviet times all sport teams were "tied" to certain industrial unions or sport societies therefore Karpaty has joined the republican sport society of trade unions "Avanhard", while the Lviv television producing plant "Elektron" became its sponsor. Out of "Silmash" only two joined Karpaty: Ihor Kulchytskyi and Josef Fales. Karpaty also adopted the same jersey colors of Silmash. Also the club was reinforced with several players from SKA Lvov and transfers. The club played its first game on April 14, 1964 against Zenit Izhevsk at the Dynamo Stadium (today – the building of regional Tax Administration) winning it 1–0. The goal was scored by the club's captain Aleksandr Filyaev. The first official game was against Lokomotiv Gomel on April 23, 1963, which Karpaty won 1–0 (goal scored by Anatoliy Kroshchenko).
Karpaty debuted in Group B in 1963 and had remained there for four seasons, until in 1968 they were promoted to Soviet First League.
On August 17, 1969, Karpaty became the first (and the only) club in the USSR football history which won the USSR Cup while playing in the Soviet First League. The road to the cup was no less exciting as the final itself. On the way there the Lions were challenged by the Soviet heavy-weights such as Ararat Yerevan and Chornomorets Odesa. The quarterfinal round matched them with Trud Foronezh that in the prior round eliminated Spartak Moscow. After the minimal score victory Karpaty were faced with the Mykolaiv's Shipbuilders. The game was perceived by the Lvivians as the chance to avenge for the last year loss to the Mykolaivans, which cost them a ticket to the Soviet Premiers. 2–0 score was enough to secure the trip to Moscow.
In the final, Karpaty played against the Army team from Rostov-on-Don at the Lenin's Stadium. The Rostov army-men were one of the best Soviet clubs in the mid-1960s and for that game they were considered as the favorites being the representatives of the Soviet Top League. Before the start of the game the Karpaty's captain Ihor Kulchytsky traditionally shacked hands with every referee... except the side-liner Eugen Harms. The reason was that the Estonian referee in their last year game against Uralmash Sverdlovsk counted a goal from an obvious offside that eventually contributed to the Karpaty's denial of a promotion. Karpaty were trailing 0–1 already after the first 20 minutes and to the end of the half were not able to equalize, but numerous Karpaty's fans drove their team forward.
The torches are being inflamed on stadium stands. Afar the banner is sparkling: "The Cup for Lviv!" On it the traditional Lviv's lion holds the highest of the national football awards. And now, after the reception of the Cup, the winners are walking around the green field of the Luzhniki...
"Lvivsky Zaliznychnyk", (August 21, 1969)
When we went out for a warm up, there sat a sector of Lviv's fans, some four thousand people. And under an accordion there sounded "Cheremshyna".
In the second half the Ukrainians broke the course of the game flow and two goals from Lykhachov and Bulhakov put the Lions ahead. Near the end of the game the Rostov-men scored another goal, but from offside. The main referee without even looking to his assistants has counted the goal and the Russians ran joyfully towards the center of the field. However a moment later he noticed the Harms' signal. The linesman clearly identified the offside. The Lvivians led the game to the victory.
In 1970–77 and 1980, Karpaty played in the Soviet Top League. Karpaty's best achievement was 4th place in 1976. Karpaty placed 4th twice that year since the season was split into 2 separate championships (spring and fall). Karpaty were primed to take silver that season, but an unexpected loss in the last home game to Zenit Leningrad pushed Karpaty back into 4th place.
While playing in the Soviet First League in 1979, Karpaty were close to repeating their 1969 achievement, when they met Dinamo Moscow in the USSR Cup semi-final. The match which was played in Moscow, went into overtime with a 1–1 score. Dinamo however prevailed, scoring on a penalty kick in extra time.
In 1981, Karpaty were merged with another Lviv team, SKA Lviv. The new team, SKA Karpaty, continued playing in the Soviet First League, almost achieving promotion in 1986 when CSKA Moscow was promoted ahead of Karpaty on goal differences. In 1989 the original name of the club was restored.
The thirteen’s season in Ukrainian Premier League became an unfortunate one for Karpaty and in 2003–04 season the team was relegated to Persha Liha. However Karpaty remained there only for two seasons and in the 2005–06 season, the club was successful in taking second place in the Persha Liha, which allowed them to participate in the Vyscha Liha the following year.
FC Karpaty play their home games at the Ukraina Stadium. The stadium was built in 1963 as Druzhba (meaning Friendship) stadium and renamed into Ukraina Stadium in 1992. The stadium was renovated on several occasions since, the latest taking place in 2001. Currently the arena has a capacity of 29,004 spectators.
Since the club has been named after the Carpathian Mountains, the image of the forest and mountains has been present on team's logo for many years. However the logo has since been updated, inspired by Lviv's Coat of Arms with a segment of a fortress and lion shown on the new crest. The club's nickname 'The Green Lions' was also derived from their new logo.
The club also has a ceremonial logo, however, it is very rarely used, mostly during TV broadcasts or video packages.
Traditionally the club colours are white and green. Throughout the club's history kit has always been designed of green and white tones; other colours are almost never used and are highly criticized by fans.
Green is considered to be the dominant of the two as clubs nicknames are "Green-Lions" and "Green-Whites". For some time black was also used and was even displayed on one of the club's former logos.
Supporters of the club have the reputation of being "nationalist thugs" and neo-Nazis. One supporter claims that supporters of the club "don't start fights" and are "just giving their team support". The supporter went on to say that "everything'll be fine" if supporters of other clubs don't provoke him or other supporters of Karpaty Lviv. If they had foreign players at the club, they would send them back home if they could. The club protects its players from its nationalist fans.Danilo Avelar, a player from Brazil, stated how he "hasn't heard of nationalist fans and hopes it isn't true". However, authorities have had problems in the past with violent fans in Lviv. There was a riot in Lviv's old town when ultranationalist Karpaty supporters clashed with supporters of German side Borussia Dortmund where supporters from both sides were injured.