NASSCO was founded in 1960 on a waterfront site with deep shipbuilding history. The location had previously hosted Lynch Shipbuilding, which built wooden vessels during World War II, and subsequently Martinolich Ship Repair. NASSCO's founders chose steel and new construction — an ambitious bet on San Diego's capacity to support major industrial maritime operations. The company built dry docks, gantry cranes, and fabrication facilities suited to ocean-going ship construction. Early contracts mixed commercial and government work. The yard's relationship with the U.S. Navy, always geographically proximate at the military bases surrounding San Diego Bay, deepened over time into a primary source of revenue.

Among the vessels NASSCO built was the Exxon Valdez, the tanker that on March 24, 1989, ran aground on Bligh Reef in Prince William Sound, Alaska, releasing approximately 11 million gallons of crude oil into one of North America's most productive marine ecosystems. The spill was at the time the largest in U.S. history and triggered legislation that permanently altered American oil tanker regulations, including the Oil Pollution Act of 1990, which mandated double hulls for tankers operating in U.S. waters. The Exxon Valdez was built to the standards of its era, which did not require double hulls. NASSCO subsequently built double-hulled tankers, as the post-Valdez regulatory environment required. The ship was the yard's work; what happened to it, and what it caused, became history of a larger kind.

General Dynamics acquired NASSCO in 1998 for $415 million, integrating it into a defense portfolio that included Bath Iron Works in Maine and Electric Boat in Connecticut. The acquisition reflected a consolidation trend across American defense contracting. Under General Dynamics ownership, NASSCO has focused increasingly on Navy contracts — particularly the construction of T-AKE dry cargo ammunition ships, the Joint High Speed Vessel program, and other auxiliary vessels for the U.S. Navy and Military Sealift Command. Commercial shipbuilding has continued alongside military work, primarily in tankers for domestic petroleum transport. The yard employs several thousand workers and remains San Diego Bay's largest private employer, one of the few heavy manufacturing enterprises surviving in a regional economy that has otherwise moved substantially toward technology and defense electronics.

The phrase 'last major new-construction shipyard on the West Coast' captures something important about American industrial geography. The Pacific Coast supported multiple significant shipyards through World War II and into the postwar era — in Seattle, in Portland, in Oakland, in Los Angeles — most of which have closed or converted to repair-only operations. NASSCO's survival reflects the value of its Navy relationships, its location adjacent to the Pacific Fleet's home waters, and the specific advantages of a workforce and infrastructure that cannot be quickly rebuilt from scratch. Expanding or replacing NASSCO would take decades and enormous capital investment. Its continued operation is less a commercial triumph than a strategic constant — a facility the Navy and the American maritime economy have found it more practical to maintain than to replace.