The club was established in 1931 as
Spencer Sports Club, a
works team of the Spencer Corsets factory. They initially played friendly matches, with their first match against St John's of the Oxfordshire Junior League played on 29 August 1931 and resulting in an 8–2 win for St John's. In 1933 they joined the Banbury division of the Oxfordshire Junior League, at which point they were renamed
Spencer Villa. they were elected to the
Birmingham Combination, also entering a team into the
Central Amateur League for the 1935–36 season. After
World War II the club turned professional. The 1947–48 season saw them finish as runners-up in the Combination and reach the first round of the
FA Cup for the first time, where they lost 2–1 at
Colchester United. When Division One was split into two divisions in 1971, the club was placed in Division One North. In 2014–15 Banbury won the Oxfordshire Senior Cup for a sixth time defeating
North Leigh 4–3 on penalties in the final. However, they were also relegated to Division One South and West at the end of the season. In August 2015, a supporter-led
Community Benefit Society took formal control of the club. Their
first season in Division One South and West saw them finish as runners-up and qualify for the promotion play-offs. they defeated
Taunton Town 2–0 in the final to earn promotion back to the Premier Division. The club were placed in the Premier Central division at the end of the
2017–18 season as part of the restructuring of the non-League pyramid. The
2020–21 season saw Banbury reach the first round of the FA Cup for the fifth time, going on to lose 2–1 at home to
Canvey Island. They reached the first round again the
following season, where they were beaten 4–0 at home by
Barrow; the season also saw them win the Southern Premier Division Central title, earning promotion to the
National League North. However, they were relegated back to the Premier Division Central of the Southern League at the end of the
2023–24 season after finishing third-from-bottom of the National League North. ==Ground==