Spain and Portugal issued similar edicts in the 1490s which demanded all Jews choose between converting to Catholicism or exile, which led to the emergence of "Marranos"—Jews who pretended to be Christians in public while still practicing their real faith in private.

The Marranos were a frequent target of suspicion, investigation, and violent discrimination by both the state (via the Inquisition) and the general public, and over the following decades many of Iberia's Sephardic Jewish merchants used their resources to flee to more tolerant cities in Protestant northern Europe—especially Amsterdam.

[3][4] By the early 17th century a small number of merchants had also moved to London, where—even though the edict of 1290 remained in place—attitudes towards the immigrant Marranos had slightly softened in the wake of the English Reformation (as well as towards other forms of Christian non-conformity), though they still had to pretend to be Spanish Catholics in public, and antisemitism was still widespread.

[6] While some advocates for readmitting the Jews to Britain did so as part of a wider argument for religious tolerance and freedom of conscience, most did so because they believed it was a necessary precondition of their eventual conversion to Christianity, and therefore also the end times.

[13][14] From 1650 onwards these families met weekly to worship together in secret at the Spanish Embassy under the leadership of Antonio Fernandez Carvajal, a wealthy Portuguese-born merchant who had relocated to London in 1635.

[17][10] Alarmed for their safety, the heads of six of the city's Jewish merchant families (Manuel Martinez Dormido, Abraham Coen Gonsales, Simon de Caceres, Domingo Vaez de Brito, Isak Lopes Chilon, and Carvajal) went with Menasseh to deliver a petition to Cromwell demanding protections for their commercial interests from seizure, but also the right to practice Judiasm in the privacy of their own homes, as well as a number of other religious freedoms—including the right to have their own burial ground.

[25] Only one-third of the Jews known to have been living in England at the time of the resettlement (prior to 1659) went on to be buried in the cemetery, and burials only began to accelerate towards the end of the 17th century as post-Marrano generations grew older.

[20][29] The Sephardic community also managed to finally purchase the freehold for the Velho Cemetery outright in 1737 for £200 (roughly £38,000 in 2024, adjusted for inflation), securing its safety from sale or redevelopment.

[20] There were a small number of burials and internments in the years immediately following the cemetery's closure for those who had previously reserved plots, or who requested being buried alongside family members.

[30] The Hebra Geumilut Hasadim Hospital continued to operate after the cemetery's closure, and in 1793 it was absorbed into another Sephardic hospital—Beth Holim, originally founded on Leman Street in 1747 as a place for "Sick Poor, Lying-in Women, and Asylum for the Aged.

"[26][22][31][32] The new Beth Holim Hospital operated exclusively as a retirement home at the Mile End site for decades, and the cemetery at its rear was maintained as a garden for residents, with trees, paths, and seats.

Most gravestones are made of limestone or marble, which means that many are now difficult (if not impossible) to read after centuries of weathering by rain, and the exact locations and identities of many of the dead have been lost.