Founded as the Swallow Sidecar Company in 1922, by two motorcycle enthusiasts, William Lyons and William Walmsley, the SS Jaguar name first appeared on a 2.5 litre saloon in 1935. The Jaguar name was given to the entire company in 1945.

Jaguar made its name in the 1950s with a series of elegantly-styled sports cars and luxury saloons. The company bought the Daimler car company (not to be confused with Daimler-Benz), in 1960 from Birmingham Small Arms Company (BSA). From the late 1960s, Daimler was used as a brand name for Jaguar's most luxurious saloons.

Jaguar merged with the British Motor Corporation (BMC), the Austin-Morris combine, to form British Motor Holdings (BMH) in 1966. After merging with Leyland and Rover, the resultant company then became British Leyland Motor Corporation (BLMC) in 1968. Financial difficulties and the publication of the Ryder Report led to effective nationalisation in 1975 and the company became BL Ltd (BL).

In 1984, Jaguar was floated off as a separate company on the stock market — one of the Thatcher government's many privatisations. The Ford Motor Company made an offer to purchase the company in September 1989 which was accepted at an Extraordinary General Meeting in January 1990 and Jaguar was removed from the London Stock Exchange listings on 28 February 1990. In 1999 it became part of Ford's new Premier Automotive Group along with Aston Martin, Volvo Cars and, from 2000, Land Rover; Aston Martin was subsequently sold off in 2007. Since Ford purchased Jaguar in 1989 it has yet to earn a profit for the Dearborn-based auto manufacturer.

Jaguar cars gained a reputation for unreliability during the 1970s and 1980s, but under Ford the reliability and build quality improved dramatically, with the company coming 7th (out of 30) in the J. D. Power Customer Satisfaction Survey (the '242-million mile road test'), and the S-Type coming 9th out of 105 cars in the same survey. In the 2003 Top Gear Survey, the XJ8 (X308) model came first. Also, in 2007, another survey by J.D. Power & Associates showed Jaguar to be the number one car company in customer satisfaction; scoring the highest ratings ever recorded.

The company was originally located in Blackpool but moved to Coventry in 1928 when demand for the Austin Swallow became too great for the factory's capacity. Today, Jaguars are assembled at Castle Bromwich in Birmingham and Halewood in Liverpool. The historic Browns Lane plant closed in 2005, leaving the XJ, XK and S-Type production at Castle Bromwich and the X-Type at Halewood, alongside the new Land Rover Freelander 2, from 2007.

Since Land Rover's 2002 purchase by Ford, it has been closely associated with Jaguar. In many countries they share a common sales and distribution network (including shared dealerships), and some models now share common components, although the only shared production facility is Halewood, for the X-Type and the Freelander 2.

Jaguar Cars holds Royal Warrants from both HM Queen Elizabeth II and HRH Prince Charles.