The city is named for King Christian IV, who founded it on 5 July 1641. The second element, sand, refers to the sandy headland the city was built on (see also Lillesand).
The name was often written Christianssand until 1877, although the map of the mapmaker Pontoppidan from 1785 spelled the name Christiansand (single 's'). That year, an official spelling reform with the purpose of making the city names "more Norwegian" changed it to Kristianssand. Kristiansund and Kristiania, now Oslo, had their spellings changed under the same reform. Despite that, a number of businesses and associations retain the "Ch" spelling. The name was again changed to its present form, Kristiansand (single "s"), in 1889.
In 2012, the city's mayor, Arvid Grundekjøn, proposed that the city be renamed Christianssand, arguing that "Kristiansand" is grammatically meaningless and that Christianssand stands for tradition. This was not very well accepted by the locals and the mayor has not pushed this further.
In any event, Christian IV (renowned for his many city foundations) visited the location in 1630 and 1635, and on 5 July 1641 formally founded the town of Christianssand on the "sand" on the opposite bank of the Torridalselva (Otra). The town was laid out in Renaissance style on a grid plan (the central section now known as Kvadraturen = The Quarters), and merchants throughout Agder were commanded to move to the new town. In return, they were to receive a variety of trading privileges and a ten-year tax exemption. In 1666, Christianssand became a garrison town, and in 1682, King Christian V decided to relocate the bishopric there from Stavanger. Hence, the young city became the main city of the Christiansand Stift.
Christianssand experienced a first and devastating fire in 1734. Later in the 18th century, after the American Revolutionary War, the town's shipbuilders experienced a boom that lasted until the Napoleonic Wars, when the continental blockade and naval warfare struck trade a severe blow. Denmark–Norway supported France and was subjected to relentless attack by Britain, as recounted in Ibsen's Terje Vigen. Only in the 1830s did the economy begin to recover, and the growth in the Norwegian shipping industry was important for Christianssand.
Another important development during the 19th century was the foundation in 1881 of Eg Sindssygeasyl, the second central psychiatric institution in Norway, after Gaustad. The psychiatric hospital drew highly specialized doctors to the city and also provided many jobs for women.
The last major fire, in 1892, left half the original section of the city in ashes, as far as the cathedral, which had been rebuilt in brick after a previous fire in 1880.