Following the Revolutionary War, an inn was built along a wagon trail (today's East Pittsburgh Street) that stretched from Philadelphia west over the Appalachian Mountains to Fort Pitt, now Pittsburgh. A tiny settlement known as Newtown grew around the inn, today the intersection of Pittsburgh and Main Streets.

A raid by Guyasuta-led Seneca Indians accompanied by Canadian rangers burned Hannastown, the original Westmoreland County Seat north of Greensburg, in 1782. Newtown became the new county seat in 1785. In 1786 the county built a log courthouse on land purchased from two residents, Christopher Truby and William Jack. Every Westmoreland County Courthouse since has stood on this site. The area surrounding the courthouse became the original borough of Greensburg, named for Revolutionary War General Nathaniel Greene and formally incorporated as a Borough in 1799.

In the early 1800's, Greensburg had very little growth. After 1850, Greensburg became a growing county seat with inns, small businesses and hardworking residents. It was a railroad stop and the discovery of large areas of soft coal nearby made it the center of a vigorous mining industry in the late 1800's and early 1900's.

Bunker Hill borough (now Fifth Ward) was merged into Greensburg in 1894. In 1905 Greensburg absorbed three adjacent boroughs, Ludwick (today's Sixth Ward); East Greensburg (now Seventh Ward); and Southeast Greensburg, unofficially known as Paradise (Eighth Ward) merged with Greensburg. New housing was constructed in various sections of town. Seton Hill College, formerly St. Joseph's Academy, became a four-year women's institution in 1918. Greensburg became a Third-Class City on January 2, 1928. After World War II, more residential areas were developed. Greensburg's cultural status grew as the Westmoreland County Museum of Art opened in 1959 and the University of Pittsburgh founded their Greensburg campus in 1963 (now located in Hempfield Township).

In the 1970's, as shopping malls and new shopping centers appeared outside the City, Greensburg's downtown was adversely affected as large downtown stores closed. However, the City became a center for service industries, professional offices and banking. Today, small downtown shops and a growing number of restaurants are reviving downtown as a mercantile center. Larger shopping centers can be found at the edges of the City.

Light to moderate industry and service industries thrive in Greensburg. The City's lack of heavy industry has advantages. Economic downturns affect the community less than they do communities depending on one major industry. Housing growth continues on the northern end of the City, with the Saybrook Village and Evergreen Hill plans.

Public education in Greensburg is handled by the Greensburg-Salem School District. The Diocese of Greensburg also maintains an elementary and secondary educational system and a number of private trade schools also exist in the City.