Originally the Miwok village known as Péta Lúuma, the area was first inhabited by the Coast Miwok Native Americans of southern Sonoma County. In fact, the Coast Miwok villages inhabited most of the area surrounding Petaluma. The Wotoki people inhabited the area south of the village of Petaluma; the Etem, Likatiut, and Tuchayalin people lived in downtown Petaluma; and the Tulme and Susuli people inhabited the land north of what is now known as Petaluma. In 1834, the entire Petaluma area was included in a land grant awarded to Mariano Guadalupe Vallejo. In 1836, Vallejo began constructing the Rancho Petaluma Adobe, a historic ranch house that still stands today as a part of the Petaluma Adobe State Historic Park. Vallejo was arrested in 1846, which began the decrease of his influence in the area.
During the gold rush in California around 1849, pioneers began to move into Petaluma from the eastern United States. The economy of Petaluma began to increase due to its position on the Petaluma River, which drew an interest in farmland and agricultural opportunity. Scows and steamers began to take over the river, bringing over agricultural and raw materials to the city of San Francisco during the Gold Rush. Petaluma was also known for its grain milling and chicken processing, which still represents a good chunk of its economic background. Petaluma was even largely referred to as the “Egg Capital of the World,” and the city was home to the only known poultry drugstore. The egg incubator was invented in town in 1879 by a man named Lyman Byce. The city is still known for its large agricultural influence today due to its dairy farms, olive groves, vineyards, and produce farms. Throughout the 1990s, Petaluma was also known as “Telecom Valley” because of the large number of telecom start-up companies that began to pop up in town.
There were an abundance of brothels along Petaluma Boulevard until the U.S. Highway was built in the 1950s. The Sonoma County Bank Building was built in the 1920s. The first official airmail flight took place in Petaluma in 1911 by a man named Fred Wiseman. His plane is now in the National Air and Space Museum. Petaluma is also known for its rich history in film; the city has been a key filming location for a great number of movies in the past century. The city has a sizable number of historic buildings and Victorian homes, making it a great location for movies set in the 1940s, 1950s, and 1960s.