The origins of Legalist thought are uncertain. Some would date it as far back as the teaching of the 7th century BCE statesman Kuan Chung (d. 645 BCE), prime minister of the state of Ch'i, whose teachings are supposed to be represented by the Kuan-tzu. Other figures associated with an early form of legalism are Shang Yang (d. 338 BCE), the putative author of The Book of Lord Shang, and Shen Pu-hai (d. 337 BCE). Shang Yang was particularly important for the development of legalism since it was he who served as governor of the state of Ch'in and strengthened it to the extent that it was able to unify China in the following century.

It was, however, Han Fei-tzu (d. 233 BCE) who systematized the various strands of Legalism in his work The Han Fei-tzu. The Confucianist Hsun-tzu, whose philosophy claimed that people were basically evil but could be guided towards goodness, had taught Han Fei-tzu. Han Fei-tzu adopted and developed Hsun-tzu's negative pessimistic attitude towards human nature by teaching that people were so bad that they needed to be controlled by strong government and strict laws. This principle was put into practice by the Ch'in dynasty, which on unifying China in 221 BCE, destroyed the feudal system and placed the country under a single monarch. Under the Ch'in dynasty land was privatized, a uniform law code was established, and weights, measures and currency were standardized. Confucianism was severely persecuted; hundreds of Confucian scholars were killed and virtually all-Confucian texts were destroyed.

The two most powerful figures in the Ch'ing dynasty were Ch'in Shih Huang Ti (d.210 BCE), the first emperor, and the Prime Minister, Li Ssu (d.208 BCE). The death of Li Ssu created a power vacuum, which led to peasant uprisings, and rebellions that broke out all over the country. In 207 BCE the Ch'in dynasty was overthrown and replaced by the Han dynasty, which favored Confucianism. The viciousness of the Ch'in dynasty served to discredit Legalism.