The first mention of the Chukhloma Church of the Assumption of the Blessed Virgin Mary dates back to 1628 and is found in the land registry books of the Galich siege. These records are related to the payment of duties that were collected annually from the church's income for the state treasury. Initially, the church was wooden, but in 1723, Father Luka Vasilyev and church elder Grigory Dmitriev, along with parishioners, appealed to the synodal office with a request to build a new church. They reported that the old church had fallen into disrepair, the roof had collapsed, and it had become impossible to hold services. The residents of the town and district decided to build a stone church in place of the old wooden one in honor of the Assumption of the Blessed Virgin Mary, with chapels dedicated to the holy apostles Peter and Paul and Makariy of Zheltovodsk and Unzhensky the Miracle Worker. Seven years later, in July 1730, Luka Vasilyev reported that the chapels of the new stone Assumption Church were ready for consecration.

The church was built according to a standard design funded by the parishioners, but the names of the contractors and builders have not survived. It is known that the bricks for construction were made from local high-quality clay. In 1739, priests Stefan Nikitin and Peter Lukin served here. Before the 1917 revolution, the church's parishioners included both townspeople and residents of nearby villages. In 1450, after a fire destroyed the women's monastery on the shore of the lake, some church items and icons were saved. These icons, including the miraculous icons of the Mother of God "Passion" and Saint Nicholas the Miracle Worker, were transferred to the Transfiguration Cathedral, and after its closure in 1932, to the Assumption Church. In 1831, the cemetery at the Assumption Church was closed, and burials were moved to the Kazan Cemetery, which is still in operation today. In 1861, trading rows were built opposite the church, which stood for about a hundred years and were dismantled in 1956-1957. The Assumption Church belonged to the Tikhonov direction.

In July 2000, the Assumption Church celebrated its 270th anniversary. Its architecture, especially in the symmetry of the bell tower and the design of the chapels' frames, shows features of a new architectural era. Otherwise, the church is typical of Russian provincial towns, which allows it to harmoniously fit into the urban landscape. The stone church is older than the square and is visible from various points in the city, which adds expressiveness to its calm silhouette.