A number of important events took place in the city which put the Edinburgh diocese at the centre of the formation of the Scottish Episcopal Church.

Scottish bishops were under pressure to declare their allegiance to William of Orange over the Stuart King James VII During an audience with the new King William in 1690, Rose's ambiguous declaration arose royal displeasure: Sir, I will serve you as far as law, reason, or conscience shall allow me.With Jacobite sympathies running throughout the Episcopal wing of the church, the Scottish Episcopalians were disestablished and Presbyterian polity was permanently established in the Church of Scotland.

Rose departed from St Giles' Cathedral in 1689 and took with him a number of supporters from the congregation to begin a separate church.

They took over a former wool store a short distance down the Royal Mile as a venue for their worship; today, Old St Paul's Church is located on this site, and claims to be the oldest Episcopal congregation in Scotland.

Gradually, as Non-Jurors and Qualified congregations were reconciled and the penal laws were repealed (1792), the Episcopal Church moved back into the mainstream of Scottish religious life; secret Episcopalian meeting houses were replaced by churches, a number of which served as pro-cathedrals for Edinburgh.

The diocese covers the historic counties of Linlithgowshire, Midlothian, Haddingtonshire, Berwickshire, Peeblesshire, Selkirkshire, Roxburghshire and the Falkirk area of Stirlingshire.