The Portsmouth Naval Shipyard, established in 1800, is one of four remaining shipyards in the Navy. Its first warship was the 74-gun USS Washington in 1815. The first barracks were built in 1820 and Marines barracks were added in 1827. A hospital was established in 1834.

1838 saw the construction of the Franklin Shiphouse, which was 240 feet long and 131 feet wide and held a roof made of 130 tons of slate. It had to be lengthened in 1854 for the largest wooden ship ever built there, the Franklin, for which the shiphouse was then named. "Old Ironsides", the USS Constitution, was overhauled at Franklin in 1855.

In 1905, the shipyard was host to the Treaty of Portsmouth, which ended the Russo-Japanese War. In 1906, President Roosevelt won the Nobel Peace Prize for having arranged the peace treaty. During World War I the shipyard employed 5,000 civilians and began to construct submarines, the first of which was the L-8, also the first sub to be built in any Navy shipyard.

By World War II, 70 submarines had been built and there were over 25,000 civilians working on them. After the war, it was the Navy's primary submarine design and development center. Designed in Portsmouth in 1953, the USS Albacore's unique teardrop shaped hull paved the way for the future of hull design around the world and was the fastest submarine in the world at the time.

The first nuclear powered submarine to be built in Portsmouth was the Swordfish in 1957. Just over a decade later, however, the base stopped building submarines and moved from construction to primarily overhauling and providing the modernization of subs. The last submarine was the Sand Lance in 1969.

In 1995, the base hosted the commissioning of the USS Maine, the first of the Trident-class submarines. By 1999, the Navy completed another overhaul, this time on its housing which was in desperate need of repairs. In 2005, Portsmouth was slated for closure under the BRAC, but employees took up a "Save Our Shipyard" campaign and the committee changed its mind.

Home to the first dry dock in the country, which is still in use today, the shipyard today employs 4,700 civilians and is centrally located about 50 miles from Boston, Massachusetts, Portland, Maine, and Manchester, New Hampshire.