Motor racing in Hungary was talked about several years before it ever happened. In the early 1930s there was a Hungarian Grand Prix listed in the calendar for several years but it never happened. In 1936, however, the organizers finally succeeded in organizing a race on a 3.1-mile track which was laid out in a park near the center of the city. The Auto Union, Mercedes-Benz and Ferrari teams all sent three cars and there was a huge crowd to watch the action. Victory went to Tazio Nuvolari's Alfa Romeo by 14secs over Bernd Rosemeyer's Auto Union.

Hungary suffered serious damage in the war years and it was not until the early 1960s that the first races were held for Formula Junior cars at Budapest's Ferihegy Airport. These events lasted for only three years and then the 1936 track was revived in a slightly different form and the European Touring Car Championship visited on a couple of occasions with Hubert Hahne winning for BMW in 1964 and Andrea de Adamich for Alfa Romeo in 1967.

At the start of the 1980s Formula 1 boss Bernie Ecclestone wanted to hold a Grand Prix behind "The Iron Curtain" and spent many months negotiating with Soviet Russia, the aim being to stage a race in Moscow - the center of the Communist world. In 1983, however, he gave up on the Russians and started looking at other Eastern European cities. Tamas Rohonyi, a Budapest-born advertising man who was involved in the Brazilian GP, suggested that Ecclestone look at Budapest. Ecclestone visited the city in the summer of 1983 and found support for the idea from the head of the national sporting authority Magyar Autoklub, Tibor Balogh.

A Hungarian government study looked at possible street circuits but concluded that it was better to build a new track in Three Springs Valley, 12 miles outside Budapest, close to the new motorway which linked the capital with Miskolc in the north-east of the county.

The valley was perfect, allowing architect Istvan Papp to design a track with marvelous spectating.

In February 1985 a consortium - Forma 1-GT - was created to build the track and the work was completed in seven months. The track opened in June 1986 and the first race took place in August. The first F1 World Championship event to be held behind the Iron Curtain drew an enormous crowd of almost 200,000 people. It was won by Nelson Piquet in a Williams. The tight nature of the circuit tended to make overtaking difficult but this did not stop Nigel Mansell winning from 12th on the grid in 1989, although, in the 1990 race, Thierry Boutsen was able to hold off a string of cars to beat Ayrton Senna to the line by 0.3secs.

The track has become a popular mid-August venue with thousands of Germans, Austrians and Italians traveling to the city to join the many race fans from the east. The track has been gradually upgraded in recent years with changes to the track coming in 2003 in an effort to increase overtaking possibilities.