In 1891 John Houlding, the leaseholder of Anfield stadium, bought the ground outright and suggested increasing the rent from £100 to £250 per annum. Everton F.C., who had played at Anfield for seven years, refused to meet his demands and moved to Goodison Park. As a result Liverpool F.C. were founded by Houlding on 15 March 1892 to play at the vacated Anfield. The original name of the newly formed club was to be Everton F.C. and Athletic Grounds Ltd; or Everton Athletic for short, but was altered to Liverpool F.C. when The Football Association refused to acknowledge the team as Everton.
In Liverpool's first season, 1892–1893, they won the Lancashire League, and were elected to the Football League Second Division for the 1893–94 season. Liverpool finished the season unbeaten as Second Division Champions, and were promoted to the First Division. Liverpool won their first Football League championship in the 1900–01 season, and were champions again in 1905–06. Liverpool played their first FA Cup final in 1914, but lost 1–0 to Burnley.
In 1921–22 and 1922–23 Liverpool won their first back-to-back League titles. This was followed by the lengthiest spell without a trophy in their history, which ended when Liverpool won the league during the 1946–47 season.
However, Liverpool struggled following this success, and were eventually relegated to the Second Division in 1953–54. In December 1959, the great Bill Shankly was appointed manager. During his first year in charge, he released 24 players and completely revamped the squad. In 1961–1962, his third season as manager, Liverpool won the Second Division Championship by eight points and were promoted to the First Division, where they have remained ever since.
In 1963–1964, Liverpool were crowned as the League Champions for the first time in 17 years. Liverpool were League Champions again in 1965–1966, having won their first FA Cup the previous season. Liverpool won their eighth league title and defeated Borussia Mönchengladbach to win their first European trophy, the UEFA Cup, in 1972–1973.
However, a year later, following another FA Cup victory, Shankly, to everyone's amazement at the time, retired. His loyal and able assistant, Bob Paisley, became manager.
Incredibly Bob Paisley was to follow on from the great Bill Shankley with an amazing run of unprecedented success. In 1975–1976, at the end of Paisley's second season as manager, Liverpool became champions, and won the UEFA Cup. The following season, Liverpool retained their League Championship, lost the FA Cup Final to Manchester United, but four days later won their first European Cup, beating Borussia Mönchengladbach 3–1 in Rome.
Liverpool retained the European Cup in 1978, beating Club Brugge 1–0 at Wembley with the winner being excellently executed by the mercurial Kenny Dalglish. In 1979 they broke another domestic record by winning the league title with 68 points, and only 16 goals conceded in 42 matches.
In 1979–1980, Liverpool won the league title for the fourth time in five seasons, and Paisley's third European Cup triumph came in 1980–1981 when Liverpool beat the mighty Real Madrid in Paris with a late goal from Alan "Barney Rubble" Kennedy. In the following two seasons, Liverpool won a League Championship and League Cup "Double". During the nine seasons Paisley managed the club, Liverpool won an amazing total of 21 trophies, including three European Cups, a UEFA Cup, six league titles and three consecutive League Cups. The only domestic trophy to elude him was the FA Cup.