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The city was founded in 1937 by real estate developer and state legislator Homer C. Ludden, who named it after his hometown of Surprise, Nebraska. Although there were only a few houses and a gas station on the one-mile-square parcel of land when Ludden subdivided it to build inexpensive houses for agricultural workers, Surprise has experienced tremendous growth in the years since.

Tens of thousands of retirees moved to the city in the 1990s and early 2000s to live in Sun City Grand, an age-restricted resort-like community, with homes built by the property development firm Del Webb. (Surprise is about five miles northwest of Del Webb's original Sun City development.)

Since it opened in 1996, Sun City Grand has become a large contributor to the city's population, which more than quadrupled from 10,187 to about 75,000 in 2004.[1] (The city's population is now considerably larger than Ludden's hometown, which had a population of 44 in the 2000 United States Census.) With a new home completed about every three hours, the Arizona city's population is expected to reach 80,000 by the end of 2005, and to double in the next decade, according to the city. Thirty-two of the state's top 50 homebuilders cater to new homebuyers, who are attracted by the city's modestly-priced homes, its relative proximity to Phoenix, and by the property taxes, which the city claims are among the lowest in the state.

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