San Esteban has written historical records from the 12th century,[3] when some families came to the area looking for water to move their mills.

San Estebán de la Sierra boasts about their wine quality, whose production is the main industrial local activity.

The lower part of the town is crossed by the river Alagón, which meanders through the mountains and finally flows into the Tagus.

The next day, the 'butlers' have lunch at the town hall, where a traditional dish called limón (lemon) is offered to the 'butlers'.

Saint Stephen (August 3) This feast is celebrated in tribute to the local patron saint giving the name to the village (San Esteban in Spanish) and used to be the primary local celebration; however this feast lost popularity because its date coincides with the harvest season, tremendously important for a primarily agricultural community.

The feast is preserved thanks to the local winery cooperative company, which commemorates its foundation by organizing a banquet open to all the neighbours and tourists with parties and music afterwards.

San Esteban has a range of different Romanesque medieval constructions such as the village chapel and the Church of St Stephen.

San Esteban de la Sierra is located in a valley with thick chestnut and eucalyptus forests and olive and wine crops on the foothills.

The local environment is one of the primary assets because it attracts numerous hikers wishing to practise hiking across this valley.