The circuit was designed by John Hugenholtz, the same engineer responsible for Suzuka, and was built by Alessandro Rocci on arid scrub land north of Madrid. Its layout is characterised by a short main straight and a predominantly tight, twisty sequence of corners that makes overtaking extremely difficult. The same configuration that frustrated Formula One drivers — Gilles Villeneuve famously held off four faster cars for the entire 1981 Spanish Grand Prix here — also shaped the character of motorcycle racing at the venue.
Jarama hosted the Spanish Formula One Grand Prix nine times between 1968 and 1981, and the circuit served as the primary Spanish motorsport venue during an era when Spain lacked the infrastructure for multiple permanent facilities.
Jarama's motorcycle Grand Prix history began in 1969 and the circuit remained on the calendar, with gaps, through 1988. The Spanish motorcycle Grand Prix was held here in 1969, 1971, 1973, 1975, and then annually from 1977 through 1986, followed by a final appearance in 1988. In 1987 the venue hosted the Portuguese motorcycle Grand Prix. An FIM motorcycle Grand Prix was held in 1993 and the circuit returned as the European motorcycle Grand Prix host in 1991 and as the Madrid motorcycle Grand Prix in 1998.
The tight, technical layout rewarded precise handling and rider skill in braking and corner entry over raw top speed, characteristics that suited the machinery and riding styles of the 1970s and 1980s Grand Prix era.
Formula One abandoned Jarama after 1981, deeming the circuit too narrow for the increasingly wide cars of that period. Motorcycle racing continued longer, but the venue eventually lost its World Championship contract as the Spanish market was served by newer facilities such as the Circuit de Catalunya, which opened in 1991. Jarama was lengthened in 1991 and underwent further upgrades in 2015, when it was officially renamed the Circuito de Madrid Jarama - RACE.
The circuit continues to host national and European championship events in touring cars, formula categories, and motorcycles. Its history as the Spanish Grand Prix venue for both cars and motorcycles in the sport's formative international decades gives it significant historical standing in Iberian motorsport.
Jarama's 15 Spanish motorcycle Grand Prix starts place it among the most used venues in the history of that national round. The combination of its Hugenholtz layout, its proximity to Madrid, and its role as the primary Spanish motorsport stage during a pivotal period in European racing history makes it an important reference point for the development of the World Championship calendar. Though no longer hosting premier-class events, the circuit remains active and its racing heritage is preserved in the context of the broader Madrid motorsport scene.