Von Koenigsegg got the idea to build his own car after watching the Norwegian puppet movie Pinchcliffe Grand Prix in his youth. However, he took his first steps in the world of business in his early 20's running a trading company called Alpraaz in Stockholm, Sweden. The success of this venture gave von Koenigsegg the necessary financial standing to launch his chosen career as a car manufacturer.
A Koenigsegg CC prototype was first publicised in 1997, while the production prototype was finally unveiled at the 2000 Paris Motor Show. The first customer took delivery of a red CC 8S in 2002 at the Geneva Auto Show and four more cars were built that year. Koenigsegg was established in Asia later that year with a premiere at the Seoul Auto Show. In 2004, the new CCR was unveiled at the Geneva Auto Show.
Initially, Koenigsegg Automotive was based in Olofström. However, on February 22, 2003, one of the production facilities caught fire and burned to the ground. The fire was extinguished with help from 40 firefighters from various different fire departments (Ängelholm, Hjärnarp, Strövelstorp, Bjuv and Helsingborg), villagers from Margretetorp, and passers-by. Approximately 15 Koenigsegg cars, body parts, machines and engines were saved before the fire grew out of control. The cause of the fire was determined to be a short-circuit in the company kitchen dishwasher, which then spread to the roof, which was insulated with hay. On that same day, the Koenigsegg cars took refuge at the nearby former Swedish Airforce Base, near Ängelholm. After a few days, the decision was made by von Koenigsegg that they would stay within the former wing to rise from the ashes.
The Koenigsegg badge was designed in 1993 by Jacob Låftman, based on the shield of the Koenigsegg family. The shield has been the family's coat-of-arms since the 12th century when a family member was knighted by the German-based Holy Roman Empire.
The phantom insignia on the Koenigsegg is a tribute to the Swedish squadron that operated from the F10 base, which had the ghost as its emblem.
On 28 February, 2005, at 12:08 hrs local time, in Nardò, Italy, the CCR broke the record for the fastest road legal car in the world, having attained , breaking the record previously held by the McLaren F1. The record was held until September 2005 when the long awaited Bugatti Veyron broke the record again at , proven by Car and Driver and BBC Top Gear. However, Bugatti's record was set on Volkswagen's own test-track Ehra-Lessien, which features a 9 km (5.6 mi) long straight. Since the Nardò Ring is a circular track of 12.5 km (7.8 mi) circumference, the records are not comparable until Bugatti tests the Veyron on Nardò or allows Koenigsegg to test on Ehra-Lessien.