The village grew around a general store established by Henry Smith. Because of its key role in the East Bay, the western area, then known as Alvarado, became the county seat when Alameda County was established in 1852. It's industrial future was established when it became the site of the first successful beet sugar mill, a natural outgrowth of the farming community. Low transportation costs, because of nearby Alvarado Dock on Alameda Creek, made it a significant shipping port for the area's produce.Union City was once the home of Costanoan Indians and then part of the lands of Mission San Jose de Guadalupe. Union City began rapidly developing in the 1850's when farmers and traders settled in the area.
The city is in the middle of a transition from a blue-collar to a mix of blue and white-collar businesses. There are about 100 small manufacturing plants in Union City. The gladiolus nursery business is flourishing; with fields of the flowers visible from Mission Boulevard. In 1959, the towns of Alvarado and Decoto combined to form Union City. Today the community is composed of industrial parks, inviting residential areas and commercial development.