Although missions, camps, and forts had been established near the present site of Toronto, the first permanent settlement was made in 1793 by John Graves Simcoe, the first lieutenant-governor of Upper Canada (1792–96), who chose the site for the establishment of a new capital, named York, for the province (now Ontario). Simcoe encouraged settlement in the area, hoping to build a model British colony attractive to Americans dissatisfied with their newly formed republic. He developed a plan to establish a strong British military presence on the frontier with the United States. In addition to building roads and settlements, Simcoe offered land grants of 200–1,000 acres. Several thousand settlers took advantage of the land grants to build the new settlement around York. Few came from Britain, with the majority migrating from New York (see New York colony) and Pennsylvania (see Pennsylvania colony), and including significant numbers of Quakers (see Quaker immigration), Mennonites (see Mennonite immigration), and Dunkers. York was renamed Toronto in 1834, at which time it had a population of about 10,000.
During the 19th century, Toronto increasingly challenged Montreal as the chief financial center of the country. As the fur trade declined in importance, Toronto’s manufacturing base brought more money and workers into the city. Also, with the expansion of rail travel and the opening of the prairies, Toronto became a major transportation, marketing, and banking center for the West. The industrial requirements of the two world wars brought rapid population growth, as well as hundreds of thousands of European immigrants. In 1931, Toronto was still remarkably homogenous, however, with 81 percent of the population of British ancestry. The largest ethnic group was Jews, who seemed remote from the city’s public persona. By World War II (1939–45), Toronto had clearly become the commercial center of Canada. The rapid influx of workers to the region created numerous problems involving housing, transportation, and city services. As a result, the Ontario legislature created the Municipality of Metropolitan Toronto, joining the governments of Toronto and 12 surrounding suburbs (1953–54). The city continued to grow rapidly in the 1950s but mainly with European immigrants—in 1961, they still accounted for 90 percent of immigrants coming to Toronto. By the 1970s, Toronto was being hailed as “the city that works,” making it one of the most desirable immigrant destinations in the world. The population of the central city peaked at just over 700,000 in 1970, then declined significantly as immigrants poured in and longtime residents flocked to the suburbs.
Canada’s new immigration regulations of 1967 had a profound effect on Toronto. Although designed to address the almost unregulated movement of sponsored immigrants into the country, it introduced for the first time the principal of nondiscrimination on the basis of race or national origin, virtually ending the “white Canada” policy that had prevailed throughout the 20th century. Toronto’s massive manufacturing and financial base provided the best economic opportunities for immigrants, who began to come from all parts of the world, transforming narrow Toronto into a city whose majority population is either first- or second- generation immigrant. Between 2000 and 2002, the largest immigrant groups were from China (57,604), India (51,756), and Pakistan (32,691), with large migrations also from the Philippines, Iran, Sri Lanka, the United Arab Emirates, Korea, Ukraine, Jamaica, and Russia. This massive influx of diverse peoples led to a new round of housing, transportation, and service problems in the 1990s that tarnished Toronto’s golden reputation. In November 2002, the city council approved a new city plan preparing for the growth of the metropolitan area by 1 million over the following 30 years.