Babelsberg was first mentioned in the Landbuch (Landbook) in 1375 by Kaiser Karl IV as an independent settlement. The city has been bombed several times and was severely damaged during the Thirty Years' War. In 1939 Babelsberg was incorporated into Potsdam and became the district Potsdam-Babelsberg. During the Potsdam Conference in 1945 Josef Stalin, Harry S. Truman and Winston Churchill resided in the mansions of Babelsberg. Because of the closeness to Berlin and Potsdam, Babelsberg's history has much in common with its neighbours, notably the common history of Prussia, the German Separation during the Cold War and German reunification.
Babelsberg developed into an industrial centre during the industrial revolution. Textile production and railway manufacturing were situated in the city.
The neighbourhood shares a direct border with Berlin, there are some remains of the Berlin Wall left. Babelsberg is widely known as a European media centre with the Babelsberg Studios, the oldest large-scale film studio in the world. It is also famous for its parks and castles which are a part of the UNESCO World Heritage Site. The Park Babelsberg surrounding the castle was planned and created by famous architects and garden-designers like Karl Friedrich Schinkel, Ludwig Persius, Peter Joseph Lenné and Hermann von Pückler-Muskau. There are two parts of the University of Potsdam in Babelsberg, one of them is situated in the Park Babelsberg.