The history of Jews in Sweden can be traced from the 17th century, when their presence is verified in the baptism records of the Stockholm Cathedral. Several Jewish families were baptised into the Lutheran Church, a requirement for permission to settle in Sweden. In 1681, for example, 28 members of the families of Israel Mandel and Moses Jacob were baptised in the Stockholm German Church in the presence of King Charles XI of Sweden, the dowager queen Hedvig Eleonora of Holstein-Gottorp, and several other high state officials.

King Charles XII (1697–1718) spent five years with an encampment in the Turkish town of Bender and accumulated a large number of debts there for his entourage. Jewish and Muslim creditors followed him to Sweden, and the Swedish law was altered so that they could hold religious services and circumcise their male children.

Early history In 1680, the Jews of Stockholm petitioned the king that they be permitted to reside there without abandoning their creed, but the application was denied because the local consistory had refused to endorse it. On 3 December 1685, Charles XI ordered the governor-general of the capital to see to it that no Jews were permitted to settle in Stockholm, or in any other part of the country, "on account of the danger of the eventual influence of the Jewish religion on the pure evangelical faith." In case Jews were found in any Swedish community, they were to be notified to leave within fourteen days.Michael Busch: Juden in Schweden 1685 bis 1838, Hannover 2020, p. 26-28 ISBN 9783865257437

Permission to settle Through court patronage Jewish merchants were occasionally appointed royal purveyors. King Charles XII (in Swedish Karl XII) usually had one or more wealthy Jews with him in the field as the paymaster(s) of his army abroad. In 1718, Jews obtained permission to settle in the kingdom without the need to abjure their religion.

Charles XII spent five years in Bender, Bessarabia (at the time a part of the Ottoman Empire) with his army and incurred substantial debts with Jewish and Muslim merchants, who supplied the army with equipment and provisions. On his return, several Muslim and Jewish creditors arrived in Sweden and Swedish law was altered to allow them to hold religious services and circumcise their sons.

After the death of Charles XII in 1718, the Swedish government was financially strained and the royal household was often relieved from pecuniary difficulties by the Jewish merchants of Stockholm who insisted, in exchange, for the granting of additional privileges to themselves and their coreligionists. As a consequence the concession of 1718 was renewed and supplemented by royal edicts of 1727, 1746, and 1748, but permission was restricted to settlement in smaller cities and rural communities. One of the most prominent Jews in Sweden at this time was the convert Lovisa Augusti, who became one of the most popular singers on the stage in Stockholm.

In the 1770s, King Gustav III had allowed Jews to come to Sweden and obtain civil rights without converting, and in 1782 an ordinance was issued (judereglementet) – due particularly to efforts of the prominent Liberal Anders Chydenius – by which Jews were restricted to reside in one of three towns: Stockholm, Gothenburg, and Norrköping. To these was added the town of Karlskrona, as a Jewish merchant, Fabian Philip, had established there a factory for the manufacture of sails and naval uniforms. They were not permitted to trade in markets elsewhere or to own property. Jews were ineligible for government positions and election to Parliament. They were forbidden from converting Lutherans to the Jewish religion.

Restricted to three cities The government was desirous of attracting wealthy Jews to the country, but it was equally careful to keep out itinerant door-to-door sellers of trinkets, some of whom had in previous years entered Sweden from Germany. Any foreign Jew who landed in Sweden was accordingly required to report, within eight days of his arrival, to the local authorities, and to produce his passport and a certificate of character, as well as a statement of his purpose in coming to the country. These certificates were issued by the elders of the congregation to which the immigrant belonged in his native country and had to be verified by the municipal authorities of the place in which the immigrant had last resided. If the certificates were unsatisfactory, the authorities were at liberty to expel the holder, but in case he was admitted he was directed to Stockholm, Gothenburg, or Norrköping. Jews who were residents of the country prior to the promulgation of this ordinance were called upon to present their certificates of character to the proper authorities, together with a statement setting forth in which city they desired to settle and make their living. The ordinance enumerated the different trades the Jews were permitted to follow, and it stipulated also that they should apprentice their sons to Swedish tradesmen in one of the three cities. In order to prevent the overcrowding of the mercantile field, it was prescribed that no foreign-born Jew should be allowed to start in business unless he possessed at least 2,000 Swedish riksdaler in cash or negotiable securities; a native-born Jew need have only 1,000 riksdaler. Rabbis were exempt, and according to previous ordinances, poor Jews were to be deported from the country.

As to the retail business, the Jews were prohibited from selling victuals, liquor, and drugs, and they were permitted to retail their special articles of food, wine, kosher meat, matzot, etc., among themselves only. Furthermore, the Jewish retail dealer was not permitted to offer his goods for sale in markets outside the city in which he was located (permission was only given to reside in Stockholm, Gothenburg, Karlskrona, and Norrköping) and he was compelled to conduct his business in open shops and was forbidden to peddle from house to house or in the streets.

The Jews were allowed to establish synagogues in the above-mentioned three cities, and to keep rabbis and other clerical officials. Intermarriages between Jews and Christians were forbidden. For every Jewish marriage celebrated a fee of six riksdaler was to be paid to the orphanage of the royal guards, this stipulation being intended as a compensation to the army for the exemption of the Jews from military service. In order to protect the interests of descendants of immigrant Jews the state ordered that, on the death of a Jew, the elders of the congregation should make an inventory of his estate and submit an account thereof, either to the orphans court or to the municipal authorities. The Jews, however, had the right to appoint guardians of minors; and a rabbinical court had jurisdiction in inheritance cases. In litigations between Jews and Christians where the facts could not be established except under oath, the Jew might be ordered to take the customary Jewish oath in the synagogue in the presence of the judge. A Jew convicted of perjury became liable to expulsion from the country.

In 1774, Aaron Isaac moved from Bützow to Stockholm and started work as an engraver of seals, and later moved into haberdashery. The Swedish Riksdag of the Estates gave permission in 1779 to create a synagogue in Stockholm, which Isaac started. He later became a supplier to the Swedish army, especially during the Russo-Swedish war of 1788–1790.

The ordinance of 1782 contained a separate clause referring to "particularly wealthy Jews, or such as are proficient in some trade almost, or quite, unknown in the country". Such persons could, through the Department of Commerce, petition the king for privileges and concessions other than those granted in the general ordinance. Jacob Marcus in Norrköping was granted such privileges and built that city's first synagogue, which opened in 1796. The Jews of Stockholm invited Levi Hirsch from Alt-Strelitz, Mecklenburg, to officiate as their rabbi. The first Swedish synagogue was located at Köpmantorget (Merchants' Square), Stockholm, in the Sjöberg house. After a few years this place was found to be too small, and the Jews in the capital selected the old auction chamber at Tyska Brunn (German Well), where they worshiped until 1870, when the large Stockholm Synagogue was inaugurated at Wahrendorfsgatan (Wahrendorf street). In 1905, the Jewish Encyclopedia reported that there were synagogues in all of the larger Swedish cities in which Jews had settled in any considerable number.

Reaction to 1838 decree After 1782, Jews gradually secured from the government reductions in restrictions, but many Jews, particularly those living in Stockholm, desired even greater opportunity and desired to not be disadvantaged due to their religion. A feeling of indignation arose among the general population against the ambitious Jews of Stockholm, many of whom were prosperous financiers; the population witnessed a different, small, and disadvantaged community of Jews prosper to a greater extent than the general population. Anger grew at the gap in wealth between Jews and others; such anger reached a height in 1838. After a new ordinance was promulgated which abolished nearly all restrictions upon Jews' civic rights (in this ordinance the Jews were, for the first time, designated , i.e., adherents of the Mosaic faith), a serious uprising took place in the capital, and numerous complaints were presented to the government, denouncing the alleged 'undue preference' shown Jews. On September 21 of the same year the government was compelled to revoke the new ordinance.

During the following years the book-market was deluged by brochures for and against the . This controversy between sympathizers and antagonists of the Jews continued until 1840, when some members of the Estates of Peasants and Burghers inside the Riksdag petitioned the government to re-establish the ordinance of 1782 in its original form. The friends of the Jews tried to show that the petitioners were actuated by religious intolerance, but their adversaries openly declared the question to be one not of religion, but of race. Those whom opposed the Jews in the Riksdag endeavoured to prove that the Jews had greatly abused the rights and privileges granted them in 1782, and that they had done so at the expense and to the detriment of the native Lutheran merchants and tradesmen. The efforts to create anti-Jewish sentiment in the Riksdag were, however, unavailing, and at a later session of that body (1853), when public opinion had turned more in favour of the Jews, they were accorded additional privileges. In 1852, Amalia Assur (1803–1889) became the first female dentist in Sweden.

During the latter half of the 19th century the few remaining disabilities of the Jews were removed. Under the law of October 26, 1860, they were granted the right to acquire real estate in rural communities, whereas they had previously been permitted to own property in the cities only. On January 20, 1863, another ordinance removed the prohibition against intermarriages between Jews and Christians, which were declared to be legal provided they were conducted by due ceremonies. A later ordinance (October 31, 1873) stipulated that the issue of marriages between members of the Swedish state church and Jews should be brought up in the Lutheran faith. If, however, a pact concerning the religion of their future children had been made in writing by the parents before their marriage, and submitted to the clergyman or other authority that performed the marriage ceremony, such agreement should remain valid.