Frederick Lugard's pitch for a Hong Kong university was openly competitive. Speaking at a graduation ceremony at St Stephen's College in January 1908, he argued that Britain needed to establish a university before Germany, which had just opened the Tongji German Medical School in Shanghai. The prize, in Lugard's framing, was China itself — educated graduates who would carry British influence into a modernizing nation. The Hong Kong Government contributed a site at West Point. The Swire Group endowed an engineering chair, partly to rehabilitate its image following a passenger death on the SS Fatshan. The Faculty of Medicine traced its roots even further back, to the Hong Kong College of Medicine for Chinese, founded by the London Missionary Society in 1887. One of that college's most renowned early alumni was Sun Yat-sen — who would later lead the Chinese Revolution. The university incorporated as a self-governing body of scholars on 30 March 1911.

The Main Building, constructed between 1910 and 1912, announced what kind of institution HKU intended to be. Designed in the post-renaissance Edwardian Baroque style with red brick and granite, it has two courtyards and a central clock tower — a gift from Sir Paul Chater in 1930. The Great Hall inside is named for Loke Yew, a Malayan benefactor from the university's earliest years. It became a declared monument in 1984. The Hung Hing Ying Building followed in 1919, a domed Edwardian structure that housed the students' union and later became the Senior Common Room; it was declared a monument in 1995. The Tang Chi Ngong Building, opened in 1931 to house the study of Chinese language and literature, joined that list the same year. The campus's layered architecture tells the story of shifting priorities across a century: colonial ambition, Chinese cultural pride, post-war expansion, and then the Centennial Campus completed in 2012, built on land the Water Supplies Department vacated.

In 1941, the Japanese invasion of Hong Kong damaged university buildings and forced HKU to close. The medical school evacuated to Chengdu and operated there until 1945. When the university reopened after the war, the student population — roughly 500 in 1941 — began a long climb. By 1961 it had reached 2,000. By 1980, more than 5,500 students were enrolled. The Faculty of Social Sciences was established in 1967, the Department of Law in 1969. Hong Kong's government, anxious after 1989 to retain local students who might otherwise study abroad in the UK, poured resources into expansion ahead of the 1997 handover. By 2001, the student count had grown to 14,300 and the number of degree courses to over a hundred. The university that had opened with a few hundred students in a single Edwardian building had become something far larger — and far harder to control.

In 2015, the HKU Council made international headlines over a single appointment. A selection committee had unanimously recommended Johannes Chan, former dean of the Faculty of Law and a scholar of constitutional law and human rights, for a senior post. Communist Party-controlled media in mainland China published more than 350 articles attacking Chan for his liberal political stance. The council, whose makeup gave outsiders a majority over students and staff, delayed and then rejected the appointment in a closed anonymous vote — twelve votes to eight — providing no reason. The student union president, Billy Fung, revealed details of the closed meeting and was subsequently expelled from the council. The episode crystallized a question that had been building for years: who, exactly, controlled Hong Kong's oldest university? Academic freedom and political pressure have remained in tension at HKU ever since.

The university's research profile has continued to grow regardless of political turbulence. In 2018–19, the Research Grants Council awarded HKU the largest share of total funding among all Hong Kong universities — HK$12,127 million, or 41.3 percent of overall grants. In 2023, Fraser Stoddart, a chemist and Nobel laureate, joined as Chair Professor of Chemistry. In 2025, Ferenc Krausz, co-recipient of the 2023 Nobel Prize in Physics for work on attosecond light pulses, was appointed to the Department of Physics. By 2025, about 434 HKU scholars were listed in Stanford University's Top 2% Scientists ranking. The institution founded by a British governor's geopolitical calculation, underwritten by a Parsi businessman's generosity, is now one of Asia's leading research universities — still navigating the tension, never fully resolved, between independence and the powers that surround it.