The museum is situated on the site of the former Ravensberg spinning mill. The factory constructed from 1855 onwards with its numerous ancillary buildings and surrounded by a historic park is today counted as one of the outstanding industrial memorials in North Rhine Westphalia. The impressive "factory castle" opposite the Historic Museum brings together the style of Prussian castles such as Babelsberg with the practical functionality of English spinning factories. This highly historic site was threatened with demolition in the 1970s. Several citizens' initiatives fought, ultimately successfully, for the preservation of the ensemble. In 1994 Bielefeld's Historic Museum was able to be accommodated in several heritage-protected buildings connected by modern intermediate building sections.

Bielefeld was the main town of the County of Ravensberg. Following the demise of the Dukes of Cleves in 1609 it passed to Brandenburg-Prussia. The manufacture and trade of linen made it an important region for commerce. The Prussian rulers ensured quality control of the linen in order to also promote its export, and consequently made Bielefeld a main hub for transshipment activities. In the 18th century the State forced an improvement of bleaching methods with the aim of maintaining international competitive capability. Since the 1830s it also pushed for the overdue industrialisation of the linen trade. In its permanent exhibition the Historic Museum displays original objects from the history of the linen trade such as the impressive table of canvas display (Legge). The garrison, the estates, the Church and administration as well as the effects of the Thirty Years' War on the town are also highlighted.