The company was founded in 1986 by Christopher Weaver in Bethesda, Maryland. Their first games were mostly sport simulations such as Gridiron! and the Wayne Gretzky Hockey series. Their headquarters was transferred to Rockville in 1990. Until 2000, Bethesda limited itself to release especially PC titles, like the first Elder Scrolls and games based on Terminator movies.

Since then they've expanded to other platforms, becoming a succesful game developer and publisher. Their catalogue includes Morrowind, Oblivion and Fallout 3. Part of ZeniMax Media.