Originally, a small church dedicated to St James the Greater was constructed in an open field at 38th and Chestnut Streets (then known as Mary and James Streets), but with the rapid influx of Catholics into the area, particularly from Ireland, the decision was made to build a larger church on the same land.

Construction of the current building, designed by Philadelphia architect Edwin Forrest Durang, began on October 16, 1881 and was completed on the same day in 1887.

The name of the parish was changed to St Agatha-St James in 1976, following a merger with the nearby St. Agatha's Church (at 38th and Spring Garden Streets in Powelton Village).

In 2018-2019, the lower level of the church was renovated into a cafeteria and events space, the old school building was renovated to serve as a student ministry and office space, and link was built connecting the church to the old school building.

In 2014, then-Archbishop Charles Chaput invited the Sodalitium Christianae Vitae (SCV), a society of apostolic life based in Peru commonly referred to as the Sodalits, to operate the combined parish and Newman community.