The city was first mentioned in written sources as Soule in Livonian Order chronicles describing the battle of the Sun. Thus the city's founding date is now considered to be September 22, 1236, the same date when the battle took place, not far from Šiauliai. At first developed as a defense post against the raids by the Teutonic and Livonian Orders. After the battle of Grunwald in 1410, the raids stopped and Šiauliai started to develop as an agricultural settlement. In 1445, a wooden church was built. It was replaced in 1634 with the brick church which can be seen in the city center today.
Šiauliai was granted Magdeburg city rights in 1589. In the 16th century it became an administrative center of the area. However, in the 17th and 18th centuries the city was devastated by The Deluge and epidemics of the Bubonic plague.
The credit for the city's rebirth goes to Antoni Tyzenhaus (1733–1785) who after a violent revolt of peasants of the Crown properties in the Northern Lithuania (so-called in Polish: Powstanie Szawelskie, 1769), started the radical economic and urban reforms. He decided to rebuilt the city according to the Classicism ideas: at first houses were built randomly in a radial shape, but Tyzenhaus decided to build the city in an orderly rectangular. Šiauliai grew to become a well-developed city, with several prominent brick buildings. In 1791 Stanisław August Poniatowski, king of the Polish–Lithuanian Commonwealth, confirmed once again that Šiauliai's city rights and granted it the coat of arm. It depicted a bear, the symbol of Samogitia, the Eye of Providence, and a red bull, the symbol of Poniatowski family. The modern coat of arms was modeled after this version.
After the Partitions of Poland, Šiauliai got a new coat of arms. The city grew and became an important educational and cultural center. Also, infrastructure was rapidly developing: in 1836–1858 a road connecting Riga and Tilsit was built, in 1871 a railroad connecting Liepāja with Romny was built. Šiauliai, being in a crossroad of important merchant routes, started to develop as an industrial town. Already in 1897 it was the third largest city in Lithuania with population of about 16,000. The demographics changed also: 56.4% of the inhabitants were Jewish in 1909. Šiauliai was known for its leather industry. Chaim Frenkel owned the biggest leather factory in the Russian Empire.
During World War I, about 65% of the buildings were burned down and the city center was destroyed. After the war and re-establishment of Lithuania, the importance of Šiauliai grew. Before Klaipėda was attached to Lithuania, the city was second after Kaunas by population size. By 1929 the city center was rebuilt. Modern utilities were also included: streets were lighted, it had public transportation, telephone and telegraph lines, water supply network and sewer.
The first independence years were difficult because industrial city lost its markets in Russia. It needed to find new clients in the Western Europe. In 1932 a railroad to Klaipėda was built and it connected the city to the western markets. In 1938 the city produced about 85% of Lithuania's leather, 60% of footwear, 75% of flax fiber, 35% of candies. Culture also flourished as many new periodicals were printed, new schools and universities opened, a library, theater, museum, and normal school were opened.
In 1939, one quarter of the city's population was Jewish (source). German Nazis entered Šiauliai on June 26, 1941. According to one of the Jewish survivors of Siauliai, Nesse Godin, some 1000 people were shot in nearby woods during the first weeks of occupation after having been forced to dig their own graves. There were two ghetto areas in Siauliai, one in the Kaukas suburb, and one in Traku (see Šiauliai ghettos). During World War II, the Jewish population was reduced from 8,000 to 500. About 80% of the buildings were destroyed.
