The name translated into English literally means "Little Side", though it is frequently referred to as "Lesser Town", "Lesser Quarter", or "Lesser Side". This name derives from its position on the left (west) bank of the river Vltava, on the slopes just below the Prague Castle, in opposition to the larger towns of Prague on the right bank, to which it is conjoined by the Charles Bridge.
In the Middle Ages, it was a dominant centre of the ethnic German citizens of Prague. It also housed a large number of noble palaces while the right-bank towns were comparatively more bourgeois and more Bohemian Czech.
In the distant past, Malá Strana was called Malé Město Pražské (Lesser Town of Prague). Malé Město Pražské was created in 1257 by amalgamating a number of settlements beneath the Prague Castle, into a single administrative unit. This was done during the reign of Přemysl Otakar II. The newly-founded town got the permission to be a royal town, and many more privileges. The residents were mostly German craftsmen, invited by the King. Even though the city was royal, the King did not master the city as a whole. By the middle of the century the city was renamed Malá Strana.
Baroque architecture predominates in Malá Strana, but the history of the district dates back to far before the Baroque era. Baroque architecture eventually dominated when the style became successfully implanted on Malá Strana after the district was devastated by fires in 1541.