The chapel was inspired and commissioned by local rancher and sculptor Marguerite Brunswig Staude, who had been inspired in 1932 by the newly constructed Empire State Building to build such a church. After an attempt to do so in Budapest, Hungary, was abandoned due to the outbreak of World War II, she decided to build the church in her native region.
The chapel is built on Coconino National Forest land. The construction supervisor was Fred Coukos, who built the chapel in 18 months at a cost of US$300,000. Upwards of 25 tons of rock was moved without the use of dynamite. The chapel was completed in 1956.
The American Institute of Architects gave the Chapel its Award of Honor in 1957. In the sculptor's words, "Though Catholic in faith, as a work of art the Chapel has a universal appeal. Its doors will ever be open to one and all, regardless of creed, that God may come to life in the souls of all men and be a living reality."
In 2007, Arizonans voted the Chapel to be one of the Seven Man-Made Wonders of Arizona.
