Arnold began as a minor claymation character created by Craig Bartlett while he worked on Pee-wee's Playhouse, where Bartlett was mainly developing cutaway segments centered on a character named Penny.

Bartlett made three early Arnold shorts—Arnold Escapes from Church (1988), The Arnold Waltz (1990), and Arnold Rides a Chair (1991)—the last of which aired as a filler short on Sesame Street. Arnold comic strips also appeared in Simpsons Illustrated magazine, drawn by Bartlett's brother-in-law Matt Groening, creator of The Simpsons.

When Bartlett and five Rugrats writers pitched ideas to Nickelodeon executives in 1993, the pitches were struggling until Bartlett played old Penny tapes as a last resort; the executives ended up far more interested in the minor character Arnold than in Penny, leading the team to develop him into the show's star.

Hey Arnold! was Nickelodeon's first animated series to cast actual children instead of adults for the kid characters, which meant many boy characters, including Arnold himself, had to be recast multiple times as the young actors' voices changed with puberty.

Gerald's voice actor Jamil Walker Smith was kept on despite his voice changing because the crew felt no replacement auditions were suitable; this was written into the show itself with the episode 'Gerald's Tonsils' explaining his deeper voice in-universe.

The series transitioned from an initial clay animation concept to traditional cel animation for its first three seasons before switching to digital ink-and-paint techniques for its final two seasons.

An attempted spinoff called The Patakis, focusing on a teenage Helga and darker themes like her mother's alcoholism and her sister's failed acting career, was rejected by Nickelodeon for being too dark, then rejected by MTV for resembling Daria; it was never made.

In 2017, the Kenya Film Classification Board banned Hey Arnold! from broadcast in the country alongside several other animated series, claiming they were 'glorifying homosexual behavior.'

A dispute over the planned sequel movie The Jungle Movie led creator Craig Bartlett to leave Nickelodeon; the film was ultimately released 16 years later, in 2017, as a television film.