According to the most famous and well-known story, a goat-herder in Ethiopia named  Kaldi noticed his goats dancing wildly after eating the red cherries of a wild shrub. Curious, he tried the cherries himself and was delighted by their stimulating effects. Soon after, it became a religious ceremonial drink to keep monks awake during their long hours prayer at night!

Since its origination in Ethiopia in the 3rd century, coffee has been used as a medicine, a wine and even an aphrodisiac. Coffee cultivation began sometime in the fifteenth century and for many centuries to follow the Yemen province of Arabia was the world's primary source of coffee. Around this time, coffee also made its way into Europe through the city of Venice where it gained popularity with the masses when street vendors began selling it in addition to cold beverages. By the middle of the 17th century the Dutch dominated the world's merchant shipping industry and they soon introduced coffee cultivation to their colonies in Indonesia on the islands of Java, Sumatra, Sulawesi and Bali. Since the 19th century, Brazil has emerged as the world's foremost coffee producer. Much of the neighboring Latin American countries supply about 65% of the world's coffee. Its popularity in America took hold in 1773, when King George angered settlers with a high tax on tea. Later, coffee kept the cowboys warm on the frontier. It was a staple of the black market during World War II, and coffee continues to wake up America every morning.

Coffeehouse shares some of the characteristics of a bar, and some of the characteristics of a restaurant, but it is different from a cafeteria. As the name suggests, coffeehouses focus on providing coffee and tea as well as light snacks. This differs from a café, which is an informal restaurant, offering a range of hot meals, and possibly being licensed to serve alcohol. Many coffee houses in the Muslim world, and in Muslim districts in the West, offer shisha, powdered tobacco smoked through a hookah. In establishments where it is tolerated - which may be found notably in the Netherlands, especially in Amsterdam - cannabis may be smoked as well.

From a cultural standpoint, coffeehouses largely serve as centers of social interaction: the coffeehouse provides social members with a place to congregate, talk, write, read, entertain one another, or pass the time, whether individually or in small groups.