Probably the first house built in the area was that of William M. Page who built his country home in 1838 on land purchased from John and Patrick Dillon. The Dillons were the original purchasers of a large tract north of the park when the first sales were made. Among initial buyers on the south side of the park were some German immigrants who later returned to thelr homeland for economic or patriotic reasons. Court decisions determining ownership of the defaulted parcels enabled Archibald Gamble, Charles Cibson, and David Nicholson, among others, to accuire the south frontage. Beginning about 1850, they built large mansions on well landscaped estates facing the park. Generally, however, real estate activity in the park's vicinity remained dormant until the late 1850's.
Some improvement work began in the park after passage of an ordinance in 1851. Sales of land occurred on the park's west side after 1856 but that area did not begin to build up until 1880. After 1858 development began on the east side of the park along Mississippi Avenue through efforts of Stephen D. Barlow and Socrates Newrnan. Barlow was the developer of Kennett Place, but most of the houses facing the park were built after 1875. Activity on the north side of the park began after the Civil War, when Benton Place was platted by Montgomery Blair in 1866. It was designed by Julius Pitzman and remains one of the earliest private streets in the nation. It was unique in that property lines extended across the roadway to the center of an oval shaped parkway. Property owners thereby controlled traffic and care of the parkway for recreation.
Lafayette Square reached the zenith of its development as an exclusive residential district by 1890, but suffered some irreversible loss from the tornado of May 27, 1896. Considerable reconstruction took place and the area retained some of its former glory until after World War I. The city's first zoning ordinance in 1918 classified the property on the park's perimeter as residential. When the zoning law was declared unconstitutional by the State Supreme Court in 1923, commercial interests began to impinge on the park's surroundings. This speeded the exodus of most of the remaining families from the Victorian town houses of the area and many were converted into rooming houses during the Depression, despite the protection of later zoning restrictions.