The town was founded in 1652 by Ebba Brahe, the widow of the military commander Jacob De la Gardie, and was granted city privileges by Queen Christina of Sweden.

Wars also contributed to the slow growth, and the city was invaded by Russian troops twice during the Greater Wrath, and large parts of the town were burnt to the ground.

The economic foundation was laid in the mid 18th century, with tar manufacturing and tobacco packaging at its centre.

The early 19th century was a time of upheaval, which saw the 1808–1809 war between Sweden and Russia, as well as a devastating fire in 1835 that destroyed approximately half of the city.

During World War II, the city was bombed once by Soviet bomber planes, causing a few casualties.

Results of the 2017 Finnish municipal election in Jakobstad: At the end of July, Jakobsdagar takes place.

The event lasts for an entire week and includes various festivities such as concerts, merchant stalls, competitions, and performances.

At the end of November a chamber music festival called Rusk is held annually in Jakobstad.

At the heart of this festival embracing superb chamber music and various other genres of the arts is the Schauman Hall in the centre of town, but the events also spread out into the surrounding urban environment.

[7] The culture of cafés and restaurants is lively in Jakobstad anyway, as the Strengberg tobacco factory was the first Finnish industrial plant to offer lunch to its employees.

[9] The town's football team FF Jaro currently plays in Veikkausliiga, the top league in Finland.