While the modern office of Prime Minister was developed in the UK the first actual usage of the word Prime Minister or Premier Ministre was used by Cardinal Richelieu, when, in 1624 he was named to head the royal council as prime minister of France. Louis XIV and his descendants generally attempted to avoid giving this title to their chief ministers.
The term Prime Minister in the sense that we know it originated in the 18th century in the United Kingdom. Since medieval times Kings of England and the United Kingdom had ministers in whom they placed special trust and who were regarded as the head of the government. Examples were Thomas Cromwell under Henry VIII; William Cecil, Lord Burghley under Elizabeth I; Clarendon under Charles II and Godolphin under Queen Anne. These ministers held a variety of formal posts, but were commonly known as "the Minister," the "first Minister" and finally the "Prime Minister."

The power of these ministers depended entirely on the personal favour of the Monarch. Although managing the Parliament was among the necessary skills of holding high office, they did not depend on a parliamentary majority for their power. Although there was a Cabinet, it was appointed entirely by the Monarch, and the Monarch usually presided over its meetings. When the Monarch tired of a first minister, they could be dismissed, or worse: Cromwell was executed and Clarendon driven into exile when they lost favour. Kings sometimes divided power equally between two or more ministers to prevent one minister becoming too powerful. Late in Anne's reign, for example, the Tory ministers Harley and St. John shared power.

The turning point in the evolution of the prime ministership came with the death of Anne in 1714 and the accession of George I. George spoke no English, spent much of his time at his home in Hannover, and had neither knowledge of nor interest in the details of English government. In these circumstances it was inevitable that the King's first minister would become the de facto head of the government. From 1721 this was the Whig politician Robert Walpole, who held office for twenty-one years. Walpole chaired Cabinet meetings, appointed all the other ministers, dispensed the royal patronage and packed the House of Commons with his supporters. Under Walpole, the doctrine of Cabinet solidarity developed. Walpole required that no minister other than him have private dealings with the King, and also that when the Cabinet had agreed on a policy, all ministers must defend it in public or resign. As a later Prime Minister, Lord Melbourne, said: "It matters not what we say, gentlemen, so long as we all say the same thing."

Walpole always denied that he was a "Prime Minister," and throughout the 18th century parliamentarians and legal scholars continued to deny that any such position was known to the Constitution. The title was first referred to on Government documents during the administration of Benjamin Disraeli but did not appear in the formal British Order of precedence until 1905. George II and George III made strenuous efforts to reclaim the personal power of the Monarch, but the increasing complexity and expense of government meant that a minister who could command the loyalty of the Commons was increasingly necessary. The long tenure of the wartime Prime Minister Pitt the Younger (1783-1801), combined with the mental illness of George III, consolidated the power of the post. By the reign of Queen Victoria it was undisputed that the Prime Minister was real ruler of the country, although his power was always conditional on the support of a majority in the Commons.

The prestige of British institutions in the 19th century and the growth of the British Empire saw the British model of Cabinet government, headed by a Prime Minister, widely copied, both in other European countries and in British colonial territories as they developed self-government. In some places alternative titles such as "Premier," "Chief Minister," "First Minister of State", "President of the Council" or "Chancellor" were adopted, but the essentials of the office were the same. By the late 20th century the majority of the world's countries had a Prime Minister or equivalent minister, holding office under either a constitutional monarchy or a ceremonial president. The main exceptions to this system have been the United States and the presidential republics in Latin America, modelled on the U.S. system, in which the President directly exercises executive authority.

Irish political scientist Professor Brian Farrell coined the term "Chairman or Chief" to describe the two alternative concepts of prime ministerial leadership, in his book of the same name about the office of Taoiseach. The term, widely used in political science worldwide, draws a distinction between a head of government who is merely a facilitator and co-ordinator of a cabinet (the "chairman"), and those who lead it forcefully from the front, setting its policy agenda and requiring all ministers to follow the leader's policies (the "chief").

Examples of "chairmen" have included Bertie Ahern (Ireland), John Major (United Kingdom) and Couve de Murville (France), while examples of chiefs included Sean Lemass (Ireland), Margaret Thatcher (United Kingdom) and Jacques Chirac under cohabitation.

Not every prime minister fits exclusively into either category: Eamon de Valera, though a strong personality, was only interested in controlling some of his government's agenda (usually constitutional matters and Anglo-Irish affairs), and allowed large areas to decided by his colleagues. Though superficially a chief (and called "the Chief" the literal translation of ''Taoiseach'' by his colleagues) historians see him as more of a chairman, particularly in later governments. Winston Churchill too, though superficially a "chief", was more chairmanlike in later governments and in those areas in which he had little personal interest.

As well as describing office holders, individual offices could be described as belonging to one or other category. Among the more dominant prime ministerial offices in terms of powers, and so more chieflike, are the premierships of Ireland and Spain, where premiers can hire and fire at will. In contrast, offices such as President of the Executive Council of the Irish Free State, Prime Minister of the Third French Republic, and the premierships of Belgium and The Netherlands are more chairmanlike in format. Lijphart referred to the premiership of the Netherlands as "primus inter pares without due emphasis on primus".