The monastery was founded by Sabbas the Sanctified in 483,[1] on the eastern side of the Kidron Valley, where - according to the monastery's own website - the first seventy hermits gathered around the hermitage of St Sabbas.[2] Later on, the laura relocated to the opposite, western side of the gorge, where the Church of Theoktistos was built in 486 and consecrated in 491[2] (today rededicated to St Nicholas). The constant growth of the community meant that soon after, in 502, the Church of the God-bearing Virgin Mary, in Greek Theotokos, was built to serve as the main church of the monastery.[2] Saint Sabbas' Typikon, the set of rules applied at the Great Laura and recorded by the saint, eventually became the worldwide model of monastic life and liturgical order[2] known as the Byzantine Rite.

Mar Saba was the home of St John of Damascus (676–749; Arabic: يوحنا الدمشقي), a key religious figure in the Iconoclastic Controversy, who, around 726, wrote letters to the Byzantine emperor Leo III the Isaurian refuting his edicts prohibiting the veneration of icons (images of Christ or other Christian religious figures). Born to a prominent Damascene political family, John worked as a high financial officer to the Umayyad Caliph Abd al-Malik; he eventually felt a higher calling and migrated to the Judaean desert, where he was tonsured and was ordained a hieromonk (monastic priest) at the Monastery of Mar Saba. St. John's tomb lies in a cave under the monastery.

Ancient sources describe an Arab attack on the monastery in 797, leading to the massacre of twenty monks.[3] Between the late eight to the tenth century, the monastery was a major translation center for Greek works into Arabic. For instance, Yannah ibn Istifan al-Fakhuri (fl. 910) translated works of Leontius of Damascus and Barsanuphius of Gaza.[4] Mar Saba was the home of the famous Georgian monk and scribe Ioane-Zosime, who moved before 973 to Saint Catherine's Monastery taking several parchment manuscripts with him.[5]

The community seems to have also suffered under the persecutions of caliph al-Hakim in 1009 as well as Turkmen raids in the 11th century but experienced occasional phases of peace as can be seen by the continued scribal and artistic activities.[6]

The monastery kept its importance during the existence of the Catholic Kingdom of Jerusalem established by Crusaders in 1099.[7]

In the late medieval period, the monastery experienced like the other Palestinian monasteries a period of decline as a result of Mamluk persecutions, the Black Death, demographic and economic degradation and the expansion of nomadic tribes. Whereas the Russian monk Zosimus estimated in 1420 the number of inhabitants at 30, the German traveler Felix Fabri recorded in the early 1480s only 6 who were living together with a group of nomadic Arabs. Thereafter, the monastery was abandoned and the remaining monks seem to have moved to St Catherine's monastery.[8]

In 1504, the Serbian monastic community of Palestine, based out of the fourteenth century monastery of St. Michael the Archangel, purchased Mar Saba..[9] The Serbs controlled the monastery until the late 1630s, and the significant financial support the monastery received from the Tsar of Russia allowed them to run the monastery semi-independently from the Patriarch of Jerusalem, the monastery's nominal overseer (much to the vexation of the patriarchate).[9] The Serbs' control of Mar Saba allowed them to play an important role in the politics of the Orthodox Church of Jerusalem, often siding with the Arabic laity and priests against the Greeks who dominated the episcopate.[9] Serbian control of the monastery eventually ended in the 1600s when the monastery got into massive debt due to the simultaneous combination of a massive building program at the monastery and a cutting off of financial support from Russia due to the outbreak of the Time of Troubles.[9] The Serbs were forced to sell the monastery to the Patriarch of Jerusalem in order to pay off their debts.[9]