The idea for the parade originated from an earlier promotion by the Eaton's chain of department stores, on 2 December 1904, when Santa walked from Union Station to the downtown Toronto Eaton store on Queen Street.

[1][2] The first official Toronto Santa Claus Parade was first held on December 2, 1905, with a single float.

From 1910 to 1912, the parade began its journey in Newmarket on a Friday afternoon, stopping overnight in York Mills and then continuing south along Yonge Street to Eaton's downtown Toronto location on Saturday afternoon.

The Montreal parade was cancelled in 1969 due to bombing threats by the Front de libération du Québec and did not resume until it was revived in the 1990s by the downtown Montreal business association as Défilé du Père Noël.

[9] Metro Chairman Paul Godfrey spearheaded a "Save Our Parade" campaign, and soon after a group of businessmen led by Ron Barbaro and George Cohon, with the help of 20 corporate sponsors, stepped in to save the parade.

Since the 1980s, the parade has received funding from various corporate sponsors (including McDonald's, Canadian Tire, Lowe's, The Walt Disney Company, Toys "R" Us Canada, Mattel, and Tim Horton's) which are featured in floats.

[11] In 2011, the parade route moved its southbound leg from Yonge Street, via Dundas Street West, to Avenue Road, Queen's Park Crescent and University Avenue, concluding at St. Lawrence Market; the change was made in order to provide more space for floats and spectators.

[12] In 2019, the route changed to begin from the east end of the city at Bloor and Parliament, owing to construction at its usual starting point.

It aired on December 5, 2020, and featured musical performances from Meghan Trainor, Shaggy and Dolly Parton.

[14] The 2021 edition of the parade would once again be broadcast-only; organizers stated that it would be logistically difficult to enforce Ontario's COVID-19 vaccine mandate during such a large scale event, and also cited safety concerns due to children under 11 years of age not yet being eligible for COVID-19 vaccines.

[15][16] In November 2024, the parade's CEO reported a $250,000 shortfall in the event's 2025 budget and launched a GoFundMe campaign to raise money.

[7] Parade CEO Clay Charters told CBC News "all of our fundraising right now and our efforts with corporate sponsorship and these conversations we've been having with the various levels of government are all about ensuring that the parade has a foundation from which we can operate into the new year and begin planning.