Pausanias writes that the city was founded by Minyans from Orchomenus under the leadership of Athamas, a descendant of Athamas the son of Aeolus. Later on they were joined by Ionians and more colonists from Athens and Boeotia.
Teos was a flourishing seaport with two fine harbours until Cyrus the Great invaded Lydia and Ionia (c. 540 BC). The Teans found it prudent to retire overseas, to the newly founded colonies of Abdera in Thrace and Phanagoria on the Asian side of the Cimmerian Bosporus. The port was revived by Antigonus Cyclops. During the times of the Roman emperors, the town was noted for its wine, a theatre and Temple of Dionysus. These are positioned near the acropolis, which is situated on a low hill and had fortifications by the 6th century. A shipwreck near Tektaş, a small rock outcrop near Teos harbour, dates from the Classical period (around the 6th to the 4th centuries BC) and implies trading connections by sea with eastern Aegean Islands.
It was a member of the Lydian group of the Ionian League, one of the four groups defined by Herodotus, based on the particular dialects of the cities. It was the birthplace of Anacreon the poet, Hecateus the historian, Protagoras the sophist, Scythinus the poet, Andron the geographer, Antimachus the epic poet and Apellicon, the preserver of the works of Aristotle. Epicurus reportedly grew up in Teos and studied there under Nausiphanes, a disciple of Democritus. Vitruvius notes Hermogenes of Priene as the architect of the monopteral temple of Dionysus at Teos.