Teramachi-dori is the street that runs along the base of Mount Kazagashira,and takes its name from the many temples (J: tera) that stand side by side along it. At around the center of the street in an expansive, generously sized precinct is Kofukuji, a place that in former days was seen as a piece of China in Japan. Known as the "red temple" by the citizens of Nagasaki because of its vermilion Sanmon Gate, Kofukuji was the first Obaku Zen temple in Japan. It was the first place where the founder Zen Master Ingen stayed keidaiafter arriving from China,and was thereafter presided over by such Zen masters as Mokusu Nyojo,who built the famed "Spectacles Bridge", and Zen Master Itsunen (Ch: Yiran),who introduced a new style of Chinese painting to Japan. As the place of origin of Obaku Zen in Japan and the sacred ground upon which Zen Master Ingen first walked in this country, Kofukuji occupies a unique place in history, and receives special protection by Nagasaki Prefecture.
The origins of Kofukuji date to around 1620 (Genna 6), when merchants from Ming Dynasty (1368-1644) China began to arrive in Nagasaki, and the Chinese priest Shin'en (Ch: Zhen Yuan）established a shrine to pray for safety in the perilous sea journey. Nagasaki in the early Edo preiod was an international city in which adventurous merchants gathered and traded their goods from Europe and the Asian continent, having recieved special permission from the shogunal government (bakufu) in Edo (Tokyo). Chinese merchants were by far the most numerous,approaching about 15% of the population of the city. Chinese residents established the temples Kofukuji, Sofukuji, Fukusaiji, and other Nagasaki "Todera"　(Chinese temples) based on their regions of origin. Also during this period, as the Edo government tightened its prohibitions on Christianity, Chinese residents who were suspected of devotion to the Christian religion established temples in increasing numbers to assert their allegiance to the Buddhist faith.

During the 200 years of the Tokugawa shogunate's "Closed Country" (sakoku)policy, established in 1641, Nagasaki was the only port open to international trade, and then only from China and the Netherlands. Citizens of the port city were completely involved in the business of commerce, bringing precious cultural objects and written materials into Japan. Chinese ships were the most active participants in commerce during this period, and Kofukuji prospered greatly under the patronage of such parishioners as the Nanjing-based ship owners and Chinese trading houses based in Nagasaki. Kofukuji occupied an enormous area filled with magnificent halls, and thrived as a center for the practice of Zen among monks and the laity, men and women.
Nagasaki was a special administrative district which fell under the direct control of the Tokugawa shogunate during the Edo period; it was not part of any domain or province. Shogunate-appointed officials and public censors were placed in the city, but mapthe real power over international relations, policy, and trade was in the hands of Nagasaki residents familiar with the city's international atmosphere and terrain. Dutch and Chinese interpreters (tsuji)wielded particular influence in international affairs; among the prominent parishioners of Kofukuji were the family of Chinese interpreters, who supported the temple over numerous generations. Chinese priests ceased to journey to Nagasaki around the mid-1700s, and after Jikuan, the ninth abbot of Kofukuji, all abbots up to the present 32nd abbot have been Japanese-born.

Nagasaki went through tremendous change from the late Edo period, through the period of rapid modernization, the Sino-Japanese War, Russo-Japanese War, and World War II. Kofukuji lost most of its Chinese parishioners after the Second World War, when most Chinese residents in Nagasaki returned to China, leaving only a few. Luckily, however, Kofukuji managed to escape the damage of the atomic bomb even while much of Nagasaki burned, and today it is still possible to savor the unique atmosphere of the ancient "Todera".