In 1860, Giovanni Panerai founded a watchmaker's store on the Ponte alle Grazie in Florence. Thirty years later, his great-grandson Guido Panerai took over. A move to Piazza San Giovanni also saw the renaming of Orologeria Svizzera to Officine Panerai, and with it the development of numerous patents in the watch and optical fields.

In 1938, the Italian Navy commissioned the family-owned company to design a particularly reliable and easy-to-read diver's watch. Lacking the necessary experience, Panerai ordered the watches from Rolex, which equipped the watches with Cortébert hand-wound movements. Panerai then installed its own dials with Radiomir luminous material. With the luminous material and extra-large numerals, the Panerai Radiomir was easy to read even underwater and in low light conditions. This particular diver's watch was subject to military secrecy for a long time and was worn exclusively by the Italian combat swimmer force "Gamma".
From 1950, the radiologically questionable Radiomir was replaced by Luminor. At that time, the characteristic half-moon bar was also created to protect the crown and to prevent accidental adjustment of the watch.