The area, once part of the ancient Noricum province, in the 7th century was resettled by Slavic tribes, who lived within the Principality of Carantania.

The migration concentrated around the former Roman settlement of Juenna (near present-day Globasnitz in an area later called Podjuna in Slovene or Jauntal in German.

The descendants of Count Siegfried I of Sponheim, who about 1035 had come to the Duchy of Carinthia as a follower of Emperor Conrad II, had a trading post erected at the site about 1090, where a church was built soon afterwards at the behest of the archbishop of Salzburg.

Völkermarkt was granted town privileges in the 13th century already and developed quickly as an important centre for trade in iron from the surrounding ore mines.

On 18 September 1979, the Yugoslav Department of State Security firebombed the Völkermarkt town hall, severely injuring three men, including two of the agents, and causing heavy damages.