It was carved out of sandstone that has been variously used as a tannery, public house cellars, and an air-raid shelter. The caves are listed as a scheduled monument by Historic England under Caves at Drury Hill. Drury Hill is the medieval street under which they were formerly located until it was demolished to make way for the Broadmarsh Shopping Centre. The newer City of Caves name refers to the fact that the city of Nottingham has hundreds of artificial caves, which have been in use for over a thousand years.

Nottingham sits upon a soft sandstone ridge which can easily be dug with simple hand tools to create artificial cave dwellings. Indeed, Nottingham was described as Tigguo Cobauc in Old Brythonic, meaning Place of Caves, by the Welsh Bishop of Sherborne Asser in his The Life of King Alfred (893). The caves here are some of the oldest remaining in the city, with pottery finds dating some of them to 1270–1300, and were inhabited from at least the 17th century until 1845 when the St. Mary's Inclosure Act banned the renting of cellars and caves as homes for the poor. None of the caves is natural; they were all cut into the sandstone for use as houses, basements and places of work by the city’s inhabitants.

Two caves cut into the cliff face and housed the only known underground tannery in Britain, opening out to daylight. The Pillar Cave was initially carved around 1250 but had been filled in by a rockfall by 1400. It was cleared and reopened as part of the tannery in 1500, with circular pits cut to hold barrels. A second cave was also cut with rectangular clay-lined vats. The small size of the vats in these caves indicates that they were probably used for sheep or goats skins rather than cowhide. There was an opening to the River Leen where they would wash the skins in the town's drinking water.

The basement walls here are all that remains of the buildings of Drury Hill, once a wealthy neighbourhood in the medieval city that by the 19th century had degenerated into one of the worst slums in Britain. Low-income families slept, ate and lived in single room basements with overcrowding and poor sanitation, making it a breeding ground for cholera, tuberculosis and smallpox.

Some of the caves here were joined and expanded to house one of 86 public air raid shelters that were found in the sandstone beneath the city by February 1941 to protect its inhabitants during the bombing attacks of the Second World War, including a particularly severe one on 8 May 1941 that is recreated as part of the tour. Holes were also dug here to supply the sand used in the sandbags that helped to protect the city.