The building was originally founded in 1220 by Maurice and Henry de Gaunt. Both of these men were grandsons of Robert Fitzhardinge, who had built the Abbey of the Black Canons of St. Augustine, where the Cathedral now stands. The building was originally built as a hospital for tending the sick, feeding the poor and educating the children. The Chapel is all that is left of a much larger building, but is unique in that it is the exclusive property of the City. The Council purchased the building for £1000 during the dissolution of the monasteries in 1539. In 1687 it was used by French Huguenot refugees who had settled in Bristol. In 1722 there was a dispute between the Council and the Cathedral authorities over the pews in the Cathedral. The Council decided not to use the Cathedral any more and since then have used St Mark's as their place of worship.

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