The history of Kayaköy, which is 8 km. from Fethiye, dates back to 3000 B.C. philologically. However, there are only remains of a few sarcophagi and rock tombs from the 4th century B.C.

The buildings on the slopes belonged to Greeks who had
settled here by provisions extended to minorities by the Ottoman Empire during the second half of the 19th century and the first half of the 20th century. During the early years of the Turkish Republic, the Greeks resident in this region were exchanged with Turks living in Western Thrace. In time, the wooden panels in doors, windows and on the roofs fell victim to natural destruction when the city acquired a ghost-like appearance.
In the deserted city, the houses, each maximally 50 sq. meters, were built in a plan to allow for panoramatic view and light fusion. The first floor was usually used for storage purposes and there were underground water cisterns to collect the rain from the rooftops. The houses were 350 to 400 in number. Scattered among them there were many chapels, a school building and a customs office.