Since the 1980s, when Southampton regularly challenged the best sides in the English league (particularly in 1984 when they were league runners-up), there had been talk of the club relocating to a new stadium to replace The Dell due to the old stadium's cramped location which made it unsuitable for major expansion work.
When the Taylor Report on 29 January 1990 required all First and Second Division clubs to have all-seater stadiums by August 1994, Southampton's directors initially decided to upgrade The Dell into an all-seater stadium (which was completed in 1993) but speculation about relocation continued, especially as an all-seater Dell had a capacity of just over 15,000; despite this, Southampton continued to defy the odds and survive in the new FA Premier League after 1992.
After a lengthy and ultimately unsuccessful attempt to build a new 25,000-seater stadium and leisure complex at Stoneham, on the outskirts of Southampton, the city council offered the club the chance to build a new ground on the disused gas work site in the heart of the city, about one and half miles from The Dell.
The move was cited as the club returning home, because the club was formed by members of the nearby St. Mary's Church, as the football team of St. Mary's Church Young Men's Association before becoming Southampton St. Mary's F.C., and eventually Southampton F.C.
Construction started in December 1999 and was completed at the end of July 2001, with work on the stadium itself and improvements to local infrastructure cost a total of £32 million.
The Saints have been in residence since August 2001 when they moved from The Dell, which for the final years of its life, held just over 15,000 spectators – less than half the size of the new stadium. The first match was played on 1 August 2001 against RCD Espanyol, with the Spanish side winning 4–3.