The circuit was conceived by Spanish engineer Manuel Medina Lara, based on a preliminary idea from Alessandro Rocci. It opened on 8 December 1985 and within four months hosted two significant international events: a motorcycle grand prix in March 1986 and the Formula One Spanish Grand Prix in April 1986. The venue's remote position within the sherry-producing region around Jerez de la Frontera proved a persistent limitation on spectator turnout, despite the circuit being able to accommodate up to 125,000 people.
Formula One used Jerez for five consecutive Spanish Grands Prix from 1986 to 1990. After the 1990 race, the championship moved to the Circuit de Catalunya in Barcelona, with the circuit's inaccessibility cited as a factor. In 1992, four corners were eliminated to create the long right-hander known as Curva Sito Pons, improving the layout's flow and racing quality.
Formula One returned in 1994 for the European Grand Prix, at which time a new chicane — the Senna curve — was inserted at the corner where Martin Donnelly had suffered a career-ending accident during qualifying for the 1990 Spanish Grand Prix.
The 1997 European Grand Prix at Jerez became one of the definitive moments in Formula One history. Michael Schumacher and Jacques Villeneuve arrived at the final race tied on points for the Drivers' Championship. The two collided during the race; Schumacher was excluded from the season results by the FIA, while Villeneuve continued to finish third and claimed the championship. The aftermath of that podium ceremony also produced a lasting institutional consequence: Jerez's mayor, Pedro Pacheco, interrupted the celebrations by presenting a trophy that had been designated for a Daimler-Benz dignitary. The incident resulted in the circuit being effectively banned from hosting Formula One grands prix, and it has not done so since.
Jerez continued to function as a regular Formula One winter testing venue until 2015, when the FIA restructured pre-season testing to a small number of approved circuits. The absolute lap record at the circuit belongs to Pedro de la Rosa, who set a time of 1:15.651 in a McLaren MP4/20 during a Formula One test in April 2005.
In 2005 the track surface was completely renewed. The final corner was renamed in 2013 in honour of Jorge Lorenzo, following his fourth world championship. On 3 May 2018, the entire facility was renamed the Circuito de Jerez – Ángel Nieto in memory of the Spanish motorcycle legend Ángel Nieto, who died in August 2017. Nieto won thirteen world championship titles across the 50cc and 125cc classes over a career spanning more than two decades. On 3 May 2019, the sixth corner (formerly Curva Dry Sac) was renamed after Dani Pedrosa, who retired from Grand Prix racing as a three-time world champion in the 125cc and 250cc categories and a three-time runner-up in MotoGP.
Jerez hosts the Spanish motorcycle Grand Prix in the MotoGP calendar, typically scheduled in late April or early May. The circuit also stages annual rounds of the Superbike World Championship and Supersport World Championship, along with the Campeonato de España de Superbike. It is consistently used as a winter testing base for both series, valued for its mild January and February temperatures that approximate race-season conditions elsewhere in Europe.
Beyond motorcycle racing, the circuit regularly hosts national and European championship rounds in formula and touring car categories, including the TCR Spain Touring Car Championship and F4 Spanish Championship. Among the notable series to have used Jerez over the years are International Formula 3000 (1988–1991, 1997), the World Sportscar Championship (1986–1988), Superleague Formula (2008), the BPR Global GT Series (1995), and World Series Formula V8 3.5 at various points between 1998 and 2017. A planned Champ Car World Series race scheduled for 2008 was abandoned when the series merged with IndyCar before the season began.
Jerez operates under a hot-summer Mediterranean climate. Dry, hot summers made Formula One and MotoGP races historically suitable for the shoulder seasons of spring and autumn, avoiding the peak summer heat. The winter testing calendar benefits from the relatively mild conditions even in January, when temperatures and track surface characteristics can resemble those encountered at mid-European circuits in the spring racing season.
The circuit has been the site of several fatal accidents. Dean Berta Viñales, a fifteen-year-old Spanish motorcycle racer, died following a crash during the Supersport 300 World Championship round on 25 September 2021. Ismael Bonilla, aged 41, died on 5 July 2020. Marcos Garrido, aged fourteen, was killed in March 2019. Nobuyuki Wakai, a twenty-five-year-old Japanese racer, died on 1 May 1993. Javier Moreno, aged twenty-one, was killed in 1990.
Despite its exclusion from Formula One following the 1997 podium controversy, Jerez has endured as one of the most active and historically significant circuits in southern Europe. Its renaming in honour of Ángel Nieto reflects its central place in Spanish motorcycle racing culture, and its continued role as a primary winter testing venue underlines its practical importance to the international paddock.