Founded in 1862 by order of Surgeon-General William Alexander Hammond, the hospital was built in the sparsely developed West Philadelphia neighborhood near the intersection of 42nd Street and Baltimore Avenue. Its 15-acre grounds ran north to 45th and Pine Streets. It was the second-largest hospital in the country, with 21 wood-frame wards and hundreds of tents containing 4,500 beds. The hospital featured a library, reading room, barber shop and a printing office that printed its newspaper, The Hospital Register.
By May 1864, Satterlee had treated more than 12,000 patients and suffered only 260 deaths, a remarkable accomplishment considering the sanitary conditions of the day.
After the war ended in 1865, the hospital was closed and the buildings razed. In the 1890s, much of the site was covered with residential housing. The lower portion of the hospital grounds survive as Clark Park.