The town was especially important in the 15th century when it was a center of Portuguese overseas expansion under Henry the Navigator, the Grand Master of the Order of Christ, successor organization to the Knights Templar in Portugal.

The seat of the municipality is the city of Tomar, which comprises the parishes of Santa Maria dos Olivais and São João Batista.

After the conquest of the region from the Moors in the Portuguese Reconquista, the land was granted in 1159 as a fief to the Order of the Knights Templar.

Local traditional legends preach that the choice was for mystical reasons and by divine inspiration, and from practices by the Grand Master of geomancy, based on exercises taken from luck and predestination.

The Templars ruled from Tomar a vast region of central Portugal which they pledged to defend from Moorish attacks and raids.

Philip IV of France, who owed the Templars huge debts, held the pope a virtual prisoner and coerced him to suppress the order on bases of false accusations and forced confessions.

Henry, enriched by his overseas enterprises, was the first ruler to improve the buildings of the Convento de Cristo since their construction by Gualdim Pais.

With the growing importance of the town as master of Portugal's overseas empire, the leadership of the Order was granted to the King by the Pope.

However, under pressure from the monarchs of Spain, the King soon proclaimed by edict that all the Jews remaining within the territory of Portugal would be after a short period considered Christians, although simultaneously he forbade them to leave, fearing that the exodus of Jewish men of knowledge and capital would harm Portugal's burgeoning commercial empire.

Jews were largely undisturbed as nominal Christians for several decades, until the establishment of a Tribunal of the Portuguese Inquisition by the initiative of the clergy in the town.

Hundreds of both Jews and New Christians were arrested, tortured and about 1,000 were executed in autos da fé, in a frenzy of persecution that peaked around 1550.

In 1581 the city was the seat of the Portuguese Cortes (feudal parliament) which acclaimed the King of Spain Felipe II as Portugal's Filipe I (see Iberian Union).

In the reign of Maria I, with royal support, a textile factory of Jácome Ratton was established against the opposition of the Order.