As late as 1870 the area that later became Homestead was farmland. The town’s industrial history began in 1879 with a glass works factory and in 1883 the Carnegie, Phipps Company Ltd. took control of a local steel mill. By the turn of the century Homestead became one of the largest and most important plants of the Carnegie Steel Company and later the United States Steel Corporation.

The level space in the bend of the Monongahela River and the geographical location made Homestead a prime spot for industrial development. The Monongahela River provided access to the plentiful coal and ore deposits in the region and the finished product could be shipped out via barges. Homestead is approximately seven (7) miles from the "point" at Pittsburgh. Initially populated by people of Western European backgrounds, the presence of the mills and with the need for laborers, the area soon became a destination for immigrants of many countries and cultures. The population grew rapidly and by 1900 there were 12,554 residents. The population peaked at 20,452 in 1920 The mill eventually encompassed the entire riverfront area stretching into the boroughs of West Homestead and Munhall. The Homestead Works became the largest steel plant in the Mon Valley and one of the largest in the world. Twelve thousand (12,000) were once employed there and this along with other steel mills became the life-blood of commerce in the region.

The town’s main street, Eight Avenue was the central shopping area for the three boroughs and the outlying areas. The four to five blocks in Homestead were once brimming with retail stores, bars, movie houses, and shoppers. Early on there was housing in the area around the mill but as the mill grew houses were built along the hillsides and the ravines on the hills above the mill. Much of the housing was build as "company housing", small, closely set frame structures characteristic of fast-growing industrial communities.

The expansion of the mill into Homestead by the federal government’s Defense Plant Corporation during the period 1941-1943 had a massive impact on Homestead proper. This legacy continues to affect the borough and its neighbors today.

Homestead has rich, but controversial history. The violence of 1892 during the Homestead strike was one of the most dramatic events in American labor history. Historians have chronicled the incidents leading up to the "watershed" event and the impact it had upon Americans labor history.

Conditions in Homestead and the Mon Valley have changed dramatically, particularly in the last few years. The sprawling Homestead works, generating enormous economic energy and employing thousands of workers has virtually disappeared to the wrecking ball. The pattern of investment in the business and residential sectors of the borough and an accompanying decline in tax base and revenues has precipitated a financial crisis in the borough.