Human habitation has occurred in the area for thousands of years. Prior to Euro-Canadian settlement, the area was inhabited by several Coast Salish indigenous groups: Qualicum, Snaw-naw-as (Nanoose), and Snuneymuxw peoples.

The Spanish were the first Europeans to explore the area in 1791, followed shortly by the fleet of George Vancouver of the British Royal Navy. On Spanish maps, the Englishman River was called 'Rio de Grullas,' (River of Cranes, i.e. herons) at the site of modern-day San Pareil, while French Creek was named 'Punta de Leonardo.'

The first European landholder in the Parksville area was John Hirst, who pre-empted 120 hectares (300 acres) of land on both sides of the Englishman River in 1873, although he never relocated there from Nanaimo. The River, as it was known, remained an outpost until the turn of the 20th century when a road was built from Nanaimo.

A post office soon followed in 1877, with mail distributed from the cabin of the first postmaster, Nelson Parks, for whom the city is named.

At that time, logging was a major industry and the extension of the Esquimalt and Nanaimo (E & N) Railway in 1901, to McBride Junction spurred Parksville's growth and the beginning of a tourism boom, mainly Vancouver Islanders who traveled to Parksville to enjoy the incredible beaches.

Motels, stores, resorts and campgrounds soon followed and the community continues to prosper today. The Village of Parksville was incorporated June 19, 1945. Parksville became a town on April 1, 1978, and a city on June 1, 1981.

Fun Fact: The city's best-known annual event since 1982 is a sandcastle-building competition held from mid-July to mid-August, dubbed 'Parksville Beachfest'. Beachfest is the only World Championship Sand Sculpting official qualification event in Canada.