The villa was constructed at Tibur (modern-day Tivoli) as a retreat from Rome for Roman Emperor Hadrian during the second and third decades of the 2nd century AD. Hadrian is said to have disliked the palace on the Palatine Hill in Rome, leading to the construction of the retreat. It was traditional that the Roman emperor had constructed a villa as a place to relax from everyday life. Previous emperors and Romans with wealth, such as Trajan, had also constructed villas. Many villas were also self-sustaining with small farms and did not need to import food.
The picturesque landscape around Tibur had made the area a popular choice for villas and rural retreats. It was reputedly popular with people from the Spanish peninsula who were residents in the city of Rome. This may have contributed to Hadrian's choice of the property – although born in Rome, his parents came from Spain and he may have been familiar with the area during his early life.
There may also have been a connection through his wife Vibia Sabina (83–136/137) who was the niece of the Emperor Trajan. Sabina's family held large landholdings and it is speculated the Tibur property may have been one of them. A villa from the Republican era formed the basis for Hadrian's establishment.
During the later years of his reign, Hadrian actually governed the empire from the villa. Hadrian started using the villa as his official residence around AD 128. A large court therefore lived there permanently and large numbers of visitors and bureaucrats would have to have been entertained and temporarily housed on site. The postal service kept it in contact with Rome 29 kilometres (18 mi) away, where the various government departments were located.
It is unknown whether Hadrian's wife lived at the villa either on a temporary or permanent basis – his relations with her were apparently rather strained or distant, possibly due to his ambiguous sexuality. Hadrian's parents had died when he was young, and he and his sister were adopted by Trajan. It is possible that Hadrian's court at the villa was predominately male but it is likely that his childhood nurse Germana, to whom he had formed a deep attachment, was probably accommodated there (she actually outlived him).
After Hadrian, the villa was occasionally used by his various successors (busts of Antoninus Pius (138–161), Marcus Aurelius (161–180), Lucius Verus (161–169), Septimius Severus and Caracalla have been found on the premises). Zenobia, the deposed queen of Palmyra, possibly lived here in the 270s.
During the decline of the Roman Empire in the 4th century, the villa gradually fell into disuse and was partially ruined as valuable statues and marble were taken away. The facility was used as a warehouse by both sides during the destructive Gothic War (535–554) between the Ostrogoths and Byzantines. Remains of lime kilns have been found, where marble from the complex was burned to extract lime for building material.
In the 16th century, Cardinal Ippolito II d'Este had much of the remaining marble and statues in Hadrian's Villa removed to decorate his own Villa d'Este located nearby. Since that period excavations have sporadically turned up more fragments and sculptures, some of which have been kept in situ or housed on site in the display buildings.