Silvermills, once an ancient village, has been part of Edinburgh since 1809.
The village is most likely to have taken its name from mills erected to smelt and refine silver ore which had been found at Hilderstone in Linlithgowshire in 1607 or, alternatively, from some of the alchemical projects of James IV or James V.
The low-lying land of Silvermills and Canonmills proved an impediment to the further northern extension of the New Town.
In the 19th century the area was best known for its great tannery. This together with other industries colonised the lands which until recently were considered uneconomic to develop. No parts of it nor the old mills still exist but until the 1990s remnants did stand on both sides of West Silvermills Lane to the south of Silvermills House (c. 1760) built for Mr. Nicol Somerville. Mill lades serving the mills led from the Water of Leith at a point just north of , through the area and on to Canonmills Loch at Canonmills.
John Lauder of Silvermills (died 28 July 1838), owner of the tannery, and father to the famous brother artists Robert Scott Lauder (1803–1869) and James Eckford Lauder (1811–1869), both born in Silvermills had a house south of the 'Great Mill Lade' (or Lead or Dam), just behind where St. Stephen's Church now stands; the land for the church was purchased by the City of Edinburgh from Mr. Lauder in 1822.
Silvermills was incorporated into Edinburgh in 1809 by a Local Act of Parliament Extending the Royalty (49 Geo III Cap. xxi) passed 28 April.
In 1835 architect George Smith erected St Stephen's School in St.Stephen's Street, which street was laid out in 1825. At the end of this street was a large skating rink designed in 1895 but converted into a theatre five years later. It then became a ballroom which burned down to be replaced by flats in the style of the surrounding Georgian architecture.
All but Silvermills House itself was redeveloped by 1997, as part of a Council plan for the area. The western side is largely housing. The main estate is by Cala Homes and has a sculpture at its centre, over life-size of a horse and rider holding an eagle, "Horse~Rider~Eagle" by sculptor, Eoghan Bridge. The eastern section contains a two storey workshop built in brick but with a traditional flavour.
Although redeveloped the medieval routes of both East and West Silvermills Lane were preserved in their entirety. The former steep dog-leg link from the east lane to Fettes Row was removed c.2000 when a residential development was built but a public pedestrian route still exists under the building.