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The Department of Community Development (DCD) was established in 1969, assuming the responsibilities of the City Planning Commission staff and the Urban Renewal Program, previously a division of the Executive Department. Throughout its existence, DCD administered the City's comprehensive planning and provided direction and support for the City's physical and economic development through community planning. The Department was the City agency responsible for coordinating public and private efforts toward physical redevelopment and renewal in both residential and business districts. This work was based on the social, economic, and physical needs of the target community or district.

A very large portion of the DCD budget was realized from federal funds. This reliance on federal grants significantly impacted DCD's operational focus as certain types of federal funding dried up and other funding programs emerged. The administration of the Seattle Model City Program was moved to DCD in 1970, but funding ended in 1974. All but one of the City's Urban Renewal projects were closed out in 1977. And at about the same time, the Community Development Block Grant program, a federal pass-through program, was established. Other federal funding programs included the Neighborhood Improvement Program, Targeted Neighborhood Assistance Program, Neighborhood Development Program, and Urban Development Action Grants.

These changes in funding impacted the DCD's priorities and also led to several departmental reorganizations in the 1970s and 1980s. In 1972, the Department added economic development to its responsibilities in response to an economic decline in Seattle that had begun in the late 1960s. The focus was to provide information to businesses that were expanding or relocating in Seattle. At this point, DCD was managing planning and implementation of complex projects that had interdepartmental implications, such as development of the Central Waterfront, Freeway Park, Westlake Mall, Pike Place Market renewal, and the huge renewal projects in the Yesler/Atlantic, Northlake, and South Seattle neighborhoods.

In 1974, a Mayor's task force report recommended separating policy planning from development planning and implementation. While policy work went to the newly created Office of Policy Planning, DCD's focus turned to development and operational planning with added renewal projects in the Denny Regrade and International District, among others. With the addition of Community Development Block Grant funding, as well as other federal programs, DCD grew considerably in the late 1970s.

However, with the advent of President Ronald Reagan's administration, federal funding for Seattle was curtailed. In 1982, DCD's budget was cut by twenty percent and remained flat for the next three years. In 1986, following passage of the City's Housing Levy, the Department added a new function, administering the construction of new moderate to low income housing units. In addition, DCD was the lead agency working with the University of Washington in the late 1980s to promote Seattle, nationally and internationally, as a technology center.

Mayor Norm Rice, whose first term began in 1990, reorganized the City's housing, human services, economic development, and planning functions. DCD was abolished in 1992. Its programs were relocated in several City agencies, including the newly organized Department of Neighborhoods, Department of Housing and Human Services, and Planning Department. DCD records include material from the City Planning Commission, Zoning Commission, Metropolitan Arts Commission, Board of Adjustment, and Urban Renewal Program.