The company was founded as the retail store Free People by Richard Hayne, Judy Wicks and Scott Belair in 1970 as a project for an entrepreneurship class at University of Pennsylvania.

Following that, the company launched Nuuly Thrift, a resale platform for buying and selling women's, men's and kids’ apparel and accessories from URBN labels and other brands.

In January 2007, URBN stopped selling keffiyehs after Jewish blogging site Jewschool called out the company for describing the item as an “anti-war woven scarf".

[20] On November 27, 2009, URBN drew the attention of the Swedish press for denying collective bargaining rights to employees at their Stockholm store by making all 38 workers redundant and re-hiring them through employment agency Academic Work.

[21][22] In response to the move, ombudsman Jimmy Ekman called for tougher laws to prevent other firms denying collective bargaining rights in this way.