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Native Americans inhabited the area of Racine for thousands of years. Artifacts that have survived include the burial mounds in what is now Mound Cemetery. Historians separate the natives living in the Root watershed at that time into Woodland people and Hopewell people. After European contact, the Miami and later the Potawatomi expanded into the area, taking part in the French fur trade.

In November 1674, while traveling from Green Bay to the territory of the Illinois Confederation, Father Jacques Marquette and his assistants, Jacques Largillier and Pierre Porteret, camped at the mouth of the Root River. These were the first Europeans known to visit what is now Racine County. Further expeditions were made in the area by René-Robert Cavelier, Sieur de La Salle in 1679 and by François Jolliet De Montigny and Jean Baptiste Bissot, Sieur de Vincennes in 1698. Nearly a century later, in 1791, a trading post would be established along Lake Michigan near where the Root River empties into it.

Following the Blackhawk War, the area surrounding Racine, which had previously been off-limits, was settled by Yankees from upstate New York and New England. In 1834 Captain Gilbert Knapp USRM, who was from Chatham, Massachusetts, founded the settlement of "Port Gilbert" at the place where the Root River empties into Lake Michigan. Knapp had first explored the area of the Root River valley in 1818, and returned with financial backing when the war ended. Within a year of Knapp's settlement hundreds of other settlers from New England and western New York had arrived and built log cabins in the area surrounding his own. Some of the settlers were from the town of Derby, Connecticut, and others came from the New England states of Connecticut, Massachusetts, Vermont, New Hampshire and Maine. The area was previously called "Kipi Kawi" and "Chippecotton" by the indigenous peoples, both names for the Root River. The name "Port Gilbert" was never really accepted, and in 1841 the community was incorporated as the village of Racine, after the French word for "root". After Wisconsin was admitted to the Union in 1848, the new legislature voted in August to incorporate Racine as a city.

In 1852, Racine College, an Episcopal college, was founded; it closed in 1933. Its location and many of its buildings are preserved today by the Community of St. Mary as part of the DeKoven Center.

Also in 1852, Racine High School, the first public high school in Wisconsin, opened. The high school operated until 1926, when it was torn down to make way for the new Racine County Courthouse. Washington Park High School was built to replace it.

Before the Civil War, Racine was well known for its strong opposition to slavery, with many slaves escaping to freedom via the Underground Railroad passing through the city. In 1854 Joshua Glover, an escaped slave who had made a home in Racine, was arrested by federal marshals and jailed in Milwaukee. One hundred men from Racine, and ultimately 5,000 Wisconsinites, rallied and broke into the jail to free him. He was helped to escape to Canada. Glover's rescue gave rise to many legal complications and a great deal of litigation. This eventually led to the Wisconsin Supreme Court declaring the Fugitive Slave Law of 1850 unconstitutional, and later, the Wisconsin State Legislature refusing to recognize the authority of the U.S. Supreme Court.

Waves of immigrants, including Danes, Germans, and Czechs, began to settle in Racine between the Civil War and the First World War. African Americans started arriving in large numbers during World War I, as they did in other Midwestern industrial towns, and Hispanics migrated to Racine from roughly 1925 onward.

Unitarians, Episcopalians and Congregationalists from New England initially dominated Racine's religious life. Racine's Emmaus Lutheran Church, the oldest Danish Lutheran Church in North America, was founded on August 22, 1851. Originally a founding member of the Danish American Lutheran Church, it has subsequently been a member of the United Danish Evangelical Lutheran Church in America (UDELCA), the American Lutheran Church (ALC), and, since 1988, the Evangelical Lutheran Church in America (ELCA). There was also a large Catholic movement to the city, opening up churches for their own ethnicity, such as St. Stanislaus (Polish), St. Rose (Irish), Holy Name (German), St. Patrick (Irish), Sacred Heart (Italian), St. Joseph (German), St. Mary (German), Holy Trinity (Slovak), St. Casimir (Lithuanian), and others. As years passed, populations moved and St. Stanislaus, Holy Name, Holy Trinity, St. Rose, and St. Casimir merged in 1998, forming St. Richard. With new waves of people arriving, older parishes received a boost from the Hispanic community, which formed Cristo Rey, re-energizing St. Patrick's into the strong Catholic community of today.

Racine has the largest North American settlement of Danes outside of Greenland.^{[citation needed]} The city has become known for its Danish pastries, particularly kringle. Several local bakeries have been featured on the Food Network highlighting the pastry. In June 2010, President Barack Obama stopped at an O & H Danish Bakery before hosting a town hall meeting on the economy and jobs later that afternoon.

Racine was a factory town almost from the beginning. The first industry in Racine County included the manufacture of fanning mills, machines that separate wheat grain from chaff. Racine also had its share of captains of industry, including J. I. Case (heavy equipment), S. C. Johnson & Son (cleaning and chemical products), and Arthur B. Modine (Heat Exchangers). Racine's harbor was central to the shipping industry in Wisconsin in the late 19th century. Racine was also an early car manufacturing center. One of the world's first automobiles was built there in 1871 or 1872 by Dr. J. W. Cathcart, as was the Pennington Victoria tricycle, the Mitchell, and the Case.

In 1887, malted milk was invented in Racine by English immigrant William Horlick, and Horlicks remains a global brand. The garbage disposal was invented in 1927 by architect John Hammes of Racine, who founded the company InSinkErator, which still produces millions of garbage disposers every year in Racine. Racine is also the home of S.C. Johnson & Son, whose headquarters were designed in 1936 by Frank Lloyd Wright. Wright also designed the Wingspread Conference Center and several homes and other buildings in Racine. The city is also home to the Dremel Corporation, Reliance Controls Corporation and Twin Disc. Case New Holland’s Racine manufacturing facility, which builds two types of tractors (the New Holland T8 and the Case IH Magnum), offers public tours throughout the year.

Racine includes the Old Main Street Historic District. Historic buildings in Racine include the Badger Building, Racine Elks Club, Lodge No. 252, St. Patrick's Roman Catholic Church, YMCA Building, Chauncey Hall House, Eli R. Cooley House, George Murray House, Hansen House, Racine College, McClurg Building, First Presbyterian Church, Memorial Hall, Racine Depot, United Laymen Bible Student Tabernacle, Chauncey Hall Building, Thomas P. Hardy House, and Horlick Field. The area is home to several National Register of Historic Places listed structures: National Register of Historic Places listings in Racine County, Wisconsin. The city is also home to Regency Mall.

Frank Lloyd Wright designed and built the Johnson Wax Headquarters building in Racine. The building was and still is considered a marvel of design innovation, despite its many practical annoyances such as rainwater leaks. Wright urged then-president Hib Johnson to build the structure outside of Racine, a city that Wright, a Wisconsin native, thought of as "backwater." Johnson refused to have the Johnson Wax Headquarters sited anywhere other than Racine.^{[citation needed]}

As of 2000 the median income for a household in the city was $37,164, and the median income for a family was $45,150. Males had a median income of $35,079 versus $24,279 for females. The per capita income for the city was $17,705. About 10.8% of families and 13.9% of the population were below the poverty line, including 20.6% of those under age 18 and 6.6% of those aged 65 or over.

As of the census of 2010, there were 78,860 people, 30,530 households, and 19,222 families residing in the city. The population density was 5,094.3 inhabitants per square mile (1,966.9/km²). There were 33,887 housing units at an average density of 2,189.1 per square mile (845.2/km²). The racial makeup of the city was 61.8% White, 22.6% African American, 0.5% Native American, 0.8% Asian, 10.3% from other races, and 4.0% from two or more races. Hispanic or Latino of any race were 20.7% of the population.

There were 30,530 households, of which 35.8% had children under the age of 18 living with them, 36.5% were married couples living together, 20.1% had a female householder with no husband present, 6.3% had a male householder with no wife present, and 37.0% were non-families. 30.5% of all households were made up of individuals, and 9.4% had someone living alone who was 65 years of age or older. The average household size was 2.53 and the average family size was 3.17.

The median age in the city was 33 years. 27.9% of residents were under the age of 18; 9.8% were between the ages of 18 and 24; 27.6% were from 25 to 44; 23.8% were from 45 to 64; and 10.9% were 65 years of age or older. The gender makeup of the city was 48.8% male and 51.2% female.

Racine employs community-oriented policing, the systematic use of partnerships and problem-solving techniques to address the immediate conditions that give rise to crime. The number of crimes committed in the city in 2013 dropped in several categories to the lowest point in decades. Racine saw a 38.3 percent drop in violent crime from 2009 to 2013, making it the 10th largest decrease in the country. Property crimes were at their lowest point since 1965, while the number of violent crimes was the lowest for any year on record.

However, that trend has since changed. As of 2018, the chance of becoming a victim of either violent or property crime in Racine is 1 in 37, thus making the city's crime rate higher than 92% of Wisconsin's other cities and towns.