The city was founded in 1869 by a Welsh businessman, John Hughes, who constructed a steel plant and several coal mines in the region; the town was thus named Yuzovka (Юзовка) in recognition of his role in its founding ("Yuz" being a Russian or Ukrainian approximation of Hughes). During Soviet times, the city's steel industry was expanded.

In 1924 at the plenum Yuzovsky executive committee had decided to rename the town Yuzovka in Stalin. In 1924 the city became known as Stalin (Сталiн). In 1929-1931 the town was renamed in Stalino (Сталино). In 1932 the city became the center of Donetsk region. In 1961, during the De-Stalinisation the city was again renamed to its modern name Donetsk after the Seversky Donets river. In addition, some sources state that the city was briefly called Trotsk—after Leon Trotsky—for a few months in 1923. Today, the city still remains an important industrial centre for coal and steel in Ukraine.

The city is currently home to two professional football teams in Ukraine: Shakhtar Donetsk and Metalurh Donetsk, both of which currently play in the Ukrainian Premier League. Important attractions of the city include the Cathedral Transfiguration of Jesus, the Donetsk National University, and others.

The principal street, from the railway station to the steelworks, is main Donetsk city attraction. It is 5.5 miles (9km) long, with the main shops, hotels, and administrative buildings.

There are a university, polytechnic, medical and trade institutes in Donetsk city, and more than 30 scientific research establishments, including a branch of the Academy of Sciences of Ukraine. Cultural amenities of Donetsk include several theaters and a philharmonic hall.