Astrakhan was founded by the Tatar Golden Horde in 1240-50, near the site of the earlier Khazar capital of Itil (7th-10th centuries). Timur the Lame destroyed the city in 1395. It became an important trading centre and the capital of Astrakhan Khanate; in 1558 it was conquered by Ivan (IV) the Terrible, who built a large citadel (kremlin) on the left bank of the Volga, around which a new city developed. Throughout the 16th-19th centuries it was a leading centre for trade with Central Asia, Persia, and India.

Astrakhan is home to Astrakhan State University, which was originally founded as a technical institute of fisheries in 1930. The Astrakhan region has been the main centre of Russia's fisheries for over 400 years, and was royal fish supplier even in Ivan the Terrible's times. The hill-top citadel, locally known as Kremlin, dates from the 16th century. The Dormition Cathedral dates from the 17th century. Later, St. Cyril's Chapel and the bishop's mansion with a church attached to it were added. There are many late 19th century Art Nouveau buildings, and a museum of history and architecture that has over 250,000 exhibits.

Fur for ‘Astrakhan’ hats is actually produced in Turkistan to the east of the Caspian Sea; the name derived from Astrakhan's position as a vital trading post between Russia and Central Asia.