The village of Laweyan began to develop around 1546 when Ki Ageng Henis settled in the area. The name Laweyan holds several meanings. First, it is believed to derive from Nglawiyan, referring to the burial site of Sunan Nglawiyan (Pakubuwana II). Second, it comes from the word lawe, which means thread, since this area was once a market selling threads used for making fabric. Third, it may come from the word ngawe, meaning a place where people were punished using lawe (such as by hanging). This is linked to the presence of two graves in Astana Laweyan — Raden Ayu Lembah and Raden Sukra — who were sentenced to death by hanging by Sunan Mangkubumi due to an affair. In Sanskrit, the word laway also exists, meaning “a headless corpse.” Fourth, it may be related to the word ngalihan or alih-alihan, meaning relocation, as this area became a new settlement for people who moved from Nusupan village (a former port during the Pajang–Kartasura era along the Bengawan Solo River, now part of Semanggi subdistrict) to avoid flooding, carried by the Wingka and Jenes rivers.

As time went on, Laweyan grew into a marketplace known for its batik craftsmanship. Environmental factors, such as the presence of small rivers, played a key role in facilitating the transportation of batik products. During the reign of Pakubuwana X (1893–1939), the Kasunanan Palace contributed significantly to the area's development by constructing a road that connected Laweyan with Pasar Klewer. Today, this road is known as Dr. Radjiman Street. The road greatly supported batik entrepreneurs in distributing their products.

In 1912, Laweyan also became the birthplace of Indonesia’s first entrepreneurial association: Sarekat Dagang Islam (SDI), founded by Haji Samanhudi. He was later declared a National Hero for mobilizing the local economy during the Spanish flu pandemic and the Great Depression (Malaise). In 1918, the area was administratively divided into two parts — one under the Surakarta municipality and the other under the Sukoharjo regency. Two years later, batik artisans in Laweyan began using stamped batik (batik cap) technology, which made production faster and easier. This golden period lasted until the 1970s, when printed textile technology began to replace manual methods.

Thanks to its long and rich history, in 2004, the city government of Surakarta officially designated Laweyan as the Kampung Batik (Batik Village). It became a cultural tourism destination hosting various activities such as exhibitions, seminars, workshops, and more.