Dearborn Park lies near the northern end of the sizable South Loop housing development laid out by the renowned architecture firm of Skidmore, Owings & Merrill in the mid-1970s. As planning for the 51-acre Dearborn Park residential complex progressed, the Chicago Park District began acquiring property to create greenspace there. Among the new park sites was property just south of the old Dearborn Street Railroad Station. Improvements began in late 1980, and the new neighborhood soon had a shaded one-and-a-quarter-acre park equipped with an obstacle fitness course.

The park, the housing complex, and nearby Dearborn Street all pay homage to General Henry Dearborn (1751-1829), Thomas Jefferson's Secretary of War from 1801 to 1809. The early Federal garrison at Chicago also bore his name. Constructed near the mouth of the Chicago River in 1803, Fort Dearborn was built to protect the strategic trade routes that passed through Chicago. During the War of 1812, however, Potowatamis raided and burned the fort, ambushing fleeing soldiers and settlers in what has since been known as the Fort Dearborn Massacre. The Federal government rebuilt the fort in 1816, and the garrison stood until the government decommissioned it twenty years later.