The city is located on the territory of the former New York Central Military Route. It is named after Pierre Van Cortland, the first lieutenant governor of New York.

Courtland, founded in 1791, became a village in 1853 (renamed 1864) and incorporated in 1900 as New York's 41st city. When the county was formed in 1808, Cortland competed with other villages for the right to become the county seat. Known as the Crown City due to its location on a plain formed by the confluence of seven valleys, Cortland sits 1,130 feet (340 m) above sea level. Forty stars, representing the 40 cities registered before Cortland, surround New York State and the Crown on the city's official seal. The seven peaks of the crown represent the seven valleys surrounding Cortland. The 41st star in the center of the crown depicts Cortland as the incorporated city closest to the geographic center of New York.

Cortland's leading industry in the late 19th and early 20th centuries was the Wickwire Brothers drawing mill, famous for making wire-wire cloth for use as window screens. The extent of Wickwires' wealth is shown by the two magnificent mansions they have built. The Victorian Chateau-style Chester Wickwire House is currently used as a House Museum and 1890 Victorian Art Center. The 1912 Charles Wickwire House is currently owned and operated by the SUNY Cortland Alumni Association. It is open to the public and is used by the Alumni Association to host college-related events and host dignitaries.

Cortland was also home to the Brockway Motor Company, a pioneering truck manufacturer. Founded in 1875 as Brockway Carriage Works, it was taken over by Mack Trucks in 1956 and ran until 1977. The city still hosts the annual Brockway Truck Show.

From 1960 to 1992, Smith Corona typewriters were made in Cortland.

Cortland boasts a classic octagonal house.[9] Cortland Country Cemetery is designed as a garden and is still in use today.

In 1868, Cortland became home to the Cortland Normal School, which gradually developed into a four-year college. Through graduate programs and research opportunities, it expanded to the State University of New York at Cortland.

In 2006, Cortland's historic clock tower burned down. It was later rebuilt and the building contained space for both business and apartments.

Cortland County Courthouse, Cortland County Poor Farm, Cortland Fire Headquarters, Cortland Free Library, First Presbyterian Church Complex, William J. Greenman Home, Randall Farm, Tompkins Street Historic District, Unitarian Universalist Church, and U.S. Post Office are listed . National Register of Historic Places.