In the land books of the Suzdal district for the years 1628 and 1630, the village of Nicholas the Wonderworker is mentioned, where there were seven icons on the prozemen, the icon of the Most Holy Theotokos Odigitria on gold, royal doors with a canopy and columns on the prozelen, a local icon of Nicholas the Wonderworker, and an icon of all saints. The church had a priest and a sacristan, two cells for the poor, as well as arable land and hay. Nearby was the village of Krasnaya. Nothing is known about the further fate of the church mentioned in 1628.

The stone church that exists today was built between 1801 and 1804 on the site of an old wooden church. The construction began by the order of Bishop Ksenofont Troepolsky of the Vladimir and Suzdal diocese on July 23, 1801, at the request of the priest of the village of Krasnoye, Stefan Stefanov, and the nobleman Perphilius Nikolaevich Buturlin. The church was erected by merchant Pyotr Borodulin with funds from parishioners and donations from landowner Buturlin. The church was completed in three years but was consecrated only on June 14, 1810.

On September 23, 1884, a parish school was opened at the Holy Sign Church, where 62 students were enrolled in 1897. Later, during the Soviet era, a general educational institution was created based on it.

According to the publication 'Historical and Statistical Description of Churches and Parishes of the Vladimir Diocese' from 1898, the church had three altars: the main one in honor of the Sign of the Most Holy Theotokos, in the refectory in honor of Saint Nicholas the Wonderworker, and Saint Martyr Paraskeva Friday. The parish included a priest and a psalmist, who received up to 500 rubles a year. The parish included the village of Krasnoye and nearby villages, where 530 men and 639 women lived.

The Krasnoselskaya church remained active even during the Soviet era. In 1920, Ivan Mikhailovich Blinov became the psalmist, serving until his arrest on January 21, 1931. He was accused of anti-Soviet agitation, did not admit guilt, and was exiled for three years to Kazakhstan, where he died in 1933. Blinov was canonized among the New Martyrs and Confessors of the Russian Church.

From August 8, 1975, to May 27, 1977, the church was served by Veniamin Zaritsky, from November 1985 to December 1986, by Ambrose Yurasov, and later by Archpriest Andrei Manchtet. Currently, Archpriest Lev Smirnov serves in the church. The parish of the Sign Church, where services are regularly held, also includes the chapel of Saint Martyr Paraskeva Friday in the village of Bogatishi.