Charles Trumbull Hayden, Tempe's founder, was born in Connecticut in 1825.

As a young man he traveled west, first to Independence, Missouri, then to Santa Fe, New Mexico, and eventually arrived in Tucson in 1858 where he started a mercantile and freighting business.

In 1870 he filed a homestead claim for 160 acres on the south bank of the Salt River, at the base of a large butte just a few miles east of the new town site of Phoenix. Within a few years he had built a store and flour mill, warehouses and blacksmith shops, and a ferry across the river. This settlement, known as Hayden's Ferry, became the trade center for the south side of the Salt River Valley.

The first settlers to move into this area were Hispanic families from Tucson and southern Arizona. They helped construct the first two irrigation canals, the Kirkland-McKinney Ditch and the San Francisco Canal, and started small farms to the east and west of Hayden's Ferry. In 1872, some of these Mexican settlers founded a town called San Pablo next to Hayden's land. By 1880, Hayden had persuaded some Mormon families to settle nearby, furnishing them with teams of animals and supplies.

After considerable growth, both Hayden's Ferry and San Pablo soon formed one community. The town was named Tempe in 1879. Lord Darrell Duppa, an Englishman who helped establish the Phoenix settlement, is usually credited with suggesting the name. When he first approached the area, the sight of the butte, wide river, and the nearby expanse of green fields reminded him of a passage he had once read about the Vale of Tempe in ancient Greece.

As more farmers came to settle in the valley and started raising alfalfa and grains for feeding livestock, the Tempe Irrigating Canal Company provided all of the necessary water. With a network of canals that extended several miles south of the river, irrigation water was carried to more than 20,000 acres of prime farmland. Crops of wheat, barley and oats ensured a steady business for the Hayden Mill. The milled flour was hauled to forts and other settlements throughout the territory. By the 1890s, some farmers started growing new cash crops such as dates and citrus fruits.

In 1885, Tempe was chosen as the site for the Territorial Normal School that trained teachers to work in schools throughout Arizona. Soon, other changes in Tempe promoted the development of the small farming community. The Maricopa and Phoenix Railroad, built in 1887, crossed the Salt River at Tempe, linking the town to the nation's growing transportation system. The Tempe Land and Improvement Company was formed to sell lots in the booming town. Tempe became one of the most important business and shipping centers for the surrounding agricultural area.

The completion of Roosevelt Dam in 1911 guaranteed enough water to meet the growing needs of Tempe farmers. While speaking at the dedication of the dam, former President Theodore Roosevelt applauded the accomplishments of the people of central Arizona and predicted that their towns would grow to become prosperous cities. Less than a year later, Arizona became the 48th state, and the Salt River Valley was well on its way to becoming the new population center of the Southwest.

Tempe has been a small agricultural community through most of its history, but by 1960, the last of the local farms were quickly disappearing as Tempe grew to become a large modern city. The town's small college had also grown, and in 1958 the institution was renamed Arizona State University.