While inns and taverns were known from antiquity, these were establishments aimed at travellers, and in general locals would rarely eat there. Modern restaurants, as businesses dedicated to the serving of food, and where specific dishes are ordered by the guest and generally prepared according to this order, emerged only in 18th-century Europe, although similar establishments had also developed in China.

A restaurant owner is called a restaurateur; both words derive from the French verb restaurer, meaning "to restore". Professional artisans of cooking are called chefs, while prep staff and line cooks prepare food items in a more systematic and less artistic fashion.

Food catering establishments which may be described as restaurants were known since the 11th century in Kaifeng, China's northern capital during the first half of the Song Dynasty (960–1279). With a population of over 1,000,000 people, a culture of hospitality and a paper currency, Kaifeng was ripe for the development of restaurants. Probably growing out of the tea houses and taverns that catered to travellers, Kaifeng's restaurants blossomed into an industry catering to locals as well as people from other regions of China. Stephen H. West argues that there was a direct correlation between the growth of restaurant businesses and institutions of theatrical stage drama, gambling, and prostitution which served the burgeoning merchant middle class during the Song.

Restaurants catered to different styles of cuisine, price brackets, and religious requirements. Even within a single restaurant much choice was available, and people ordered the entree they wanted from written menus. An account from 1275 writes of Hangzhou, the capital city for the last half of the dynasty:

The restaurants in Hangzhou also catered to many northern Chinese who had fled south from Kaifeng during the Jurchen invasion of the 1120s, while it is also known that many restaurants were run by families formerly from Kaifeng.

According to the Guinness Book of Records, the Sobrino de Botin in Madrid, Spain, is the oldest true restaurant in existence today. It claims to have opened in 1725, though in a different location. The restaurant Tavares, in Lisbon, Portugal, continuously open since 1784 in the same location (though not the same building), claims to be the second oldest in the Iberian Peninsula. There is, however, evidence that Henry III of France ate at the still-extant Tour d'Argent, in Paris, France, on March 4, 1582. Another claim to be the world's oldest restaurant is made by Stiftskeller St. Peter, in Salzburg, Austria, which has been in existence since 803 AD, since the time of emperor Charlemagne, as an inn. Zum Franziskaner, a German restaurant in Stockholm, Sweden, claims to have been in operation at the same address, but in three different houses, since 1421.

The term restaurant (from the French restaurer, to restore) first appeared in the 16th century, meaning "a food which restores", and referred specifically to a rich, highly flavoured soup. It was first applied to an eating establishment in around 1765 founded by a Parisian soup-seller named Boulanger. The first restaurant in the form that became standard (customers sitting down with individual portions at individual tables, selecting food from menus, during fixed opening hours) was the Grand Taverne de Londres (the "Great Tavern of London"), founded in Paris in 1782 by a man named Antoine Beauvilliers, a leading culinary writer and gastronomic authority who achieved a reputation as a successful restaurateur. He later wrote what became a standard cookbook, L'Art du cuisinier (1814).

A leading restaurant of the Napoleonic era was the Véry, which was lavishly decorated and boasted a menu with extensive choices of soups, fish and meat dishes, and scores of side dishes. Balzac often dined there. Although absorbed by a neighboring business in 1869, the resulting establishment Le Grand Véfour is still in business.

The restaurant described by Britannica as the most illustrious of all those in Paris in the 19th century was the Café Anglais (the "English coffee-shop") on the Boulevard des Italiens, showing for a second time the high regard that Parisians evidently had for London, England, and the English — at least when it came to naming their restaurants.

Restaurants then spread rapidly across the world, with the first in the United States (Jullien's Restarator) opened in Boston in 1794. The oldest restaurant in continuous operation in the United States, Union Oyster House is also in Boston and has been open since 1826. Most restaurants continued on the standard approach of providing a shared meal on the table to which customers would then help themselves (Service à la française, commonly called "family style" restaurants), something which encouraged them to eat rather quickly. Another formal style of dining, where waiters carry platters of food around the table and diners serve themselves, is known as Service à la russe, as it is said to have been introduced to France by the Russian Prince Kurakin in the 1810s, from where it spread rapidly to England and beyond.