Captain John Smith landed on a part of Phoebus known as Strawberry Banks on the first voyage up the James River in 1607. The area which became the Town of Phoebus was founded in 1609 as Mill Creek and was located on the banks of the Chesapeake Bay and Hampton Roads, directly across from Norfolk's Willoughby Spit. Originally created in 1634 as Elizabeth City Shire, one of eight shires created in colonial Virginia, Elizabeth City County was formed in 1643. Old Point Comfort became the home of Fort Monroe, the oldest active duty fort in the nation.
The Town of Phoebus was Roseland Farm until 1871 when it was divided into lots and became known as Chesapeake City. When the town was incorporated in 1900, it was named Phoebus in honor of its leading citizen, Harrison Phoebus.