It was founded on the Mount Shadwell, Wan Chai site which was formerly occupied by the "Royal Naval Hospital", which was severely damaged during the Second World War.

Development and expansion of the hospital was overseen by Sister Dr Mary Aquinas Monaghan, a missionary nun from Ireland.

Its surgical department enjoys high acclaim as the Ruttonjee is the only hospital in Hong Kong to provide gender-reassignment operations.

The geriatrics service has also developed in recent years in response to the ageing population of the Wan Chai district.

On 31 March 2010, the Hong Kong High Court approved a settlement in the legal action brought by British author Martin Jacques over the death of his wife Harinder Veriah.