Angelfire was founded in 1996 and was originally a combination Web site building and medical transcription service. Eventually the site dropped the transcription service and focused solely on Web site hosting, offering only paid memberships. The site was bought by Mountain View, California–based WhoWhere in 1997, which, in turn, was subsequently purchased by the search engine company Lycos in 1998. Since Lycos already offered free website hosting with advertising through its acquisition of Tripod.com, Angelfire's offering was modified to also have parity with Tripod, including the addition of an increased amount of advertising, but also by offering more disk space.
Until May 2004, Angelfire offered paid email (as a cobrand of Mailcity) at the @angelfire.com domain, but this feature has been replaced by webmail through Lycos Domains for premium users only.
Angelfire received a major redesign in September 2010. It was completely re-coded using HTML5 mark-up and now promotes the Angelfire site builder as its main Web publishing tool. The classic Web Shell tool is still active but is only available to members with paid plans.