The history of the Observatory begins in the spring of 1964, when a group of renowned Dutch astronomers, accompanied by Lysimachos N. Mavridis, Professor of Geodetic Astronomy at the University of Thessaloniki, visited the village of Stephani for the first time to explore the possibility of installing a small reflector telescope in Greece.

The first observations at the Stephanion Observatory were undertaken in March 1967 with a guest 38cm reflector and a UBV photometer from the Bergedorf Observatory of the University of Hamburg, Germany.

Since then, the observatory has hosted a wide range of instruments, including telescopes from the French National Space Agency (CNES) for satellite monitoring, and a 40 cm reflector from the Utrecht Observatory in the Netherlands, which was used by astronomers from all Dutch astronomical institutions. The Dutch station operated from 1967 to 1973 and was known as the “Netherlands’ Southern Observing Station” (N.E.S.O.S).

In June 1971, the University of Thessaloniki installed its 30-inch (76 cm) Cassegrain reflector at the Observatory. Until 1975—when the 1.23 m Cassegrain–Coudé reflector at Kryoneri became operational—this was the largest telescope in Greece and the Balkans.