Founded in 1730 by William Fell, who was attracted by its beautiful deep water and proximity to agriculture and thick forests, Fells Point became a shipbuilding and commercial center. About 1763, William's son Edward Fell laid out streets and began selling plots for homes. The town grew quickly, and eventually incorporated with Baltimore Town and Jones Town in 1797 to form the City of Baltimore. The area grew wealthy on the tobacco, flour, and coffee trades through the 18th and 19th centuries.
Some of the first vessels commissioned for the US Navy were built in Fells Point yards, including the USS Constellation in 1797. However, the area became best known for producing topsail schooners, sometimes erroneously called Baltimore clippers, renowned for their great speed and handling. They were excellent blockade runners, and were frequently used as armed privateers. The Pride of Baltimore II is based on the Chasseur, built by Thomas Kemp, which was one of the most successful privateers built in Fells Point.
During the War of 1812, Fells Point built and supported dozens of privateers who preyed on British shipping. Thus, Baltimore became a principal target of the British during the war, which eventually led to the bombardment of Fort McHenry.