Toronto FC joined MLS in 2007 as an expansion team and was the first Canadian-based franchise in the league.

The first team is operated by Maple Leaf Sports & Entertainment, which also operates the USL League One affiliate team Toronto FC II and most other professional sports franchises in the city, like the Toronto Maple Leafs of the NHL, Toronto Raptors of the NBA, and the Toronto Argonauts of the CFL.

The voting options were "Toronto Northmen", "Inter Toronto FC", "Toronto Reds", and "Toronto FC". Over 40 percent of the online vote supported the simple Toronto FC name.

On 22 August 2006, Maple Leaf Sports & Entertainment announced Mo Johnston as Head Coach for the club's inaugural 2007 season. Before the start of the 2008 season, it was announced that Johnston was moving upstairs to fill the role of Director of Football, while John Carver took over coaching duties. Johnston quickly earned himself the nickname "Trader Mo" because in the first half of the first season alone he traded 9 players.

The Canadian Classique, also known as the 401 Derby and the Two Solitudes Derby, is a soccer rivalry between Canadian clubs, Toronto FC and CF Montréal (formerly the Montreal Impact). The rivalry gets the "401" nickname from Ontario Highway 401, which forms most of the standard driving route between the two cities.

During the 2017 season (including playoffs), Alex Bono recorded 13.5 shutouts. (He shared one clean sheet with Clint Irwin against Sporting Kansas City.)

On June 26, 2019, Japanese forward Tsubasa Endoh scored the fastest goal in TFC history, just 29 seconds into the game against Atlanta United FC. Toronto went on to win the game 3-2.

Maurice Edu gave up his final year of NCAA eligibility to join Major League Soccer in 2007 and was drafted by Toronto as the first overall pick of the MLS SuperDraft. He made his MLS debut on April 25, 2007, against the Kansas City Wizards, and went on to make twenty-five appearances and score four goals that first season. He ended the year by winning the MLS Rookie of the Year award.

In the 2009 Canadian Championship, Toronto required a four-goal victory over the Montreal Impact in the final game of the competition to nullify the Vancouver Whitecaps' +4 goal differential. Anything less would result in Vancouver winning the championship. Toronto went down 1-0 early, but overwhelmed an under-strength Impact side 6-1 on the back of a hat-trick by Dwayne De Rosario. Amado Guevara added two, scoring in the 69th and 92nd minute. Chad Barrett scored the decisive goal in the 82nd minute, which gave TFC the lead over Vancouver. The unlikely victory was dubbed by fans and media as the "Miracle in Montreal".

Management made wholesale changes to the roster before and during the 2011 season, trading numerous players, including their captain and Toronto native Dwayne De Rosario. The team went on to set a record for most players used in a MLS season with 39.