The region now known as Dibër was inhabited in pre-Christian times by the Illyrian tribe known to the Romans as Penestae.
The name of Peshkopi is derived from the Greek Episkopi or 'bishop's seat', which shows early signs of Christianity settling in the Balkans. Bulgarian maps of the eleventh century show the town under the name Presolengrad. The region of Dibër was subsumed under the Orthodox archiepiscopate of Ohrid in 1019, and one year later received the status of an episcopate with its center in the Bulke ward of Peshkopi, located in what is now the neighborhood of Dobrovë. The central church of the Dibër Episcopate was that of St. Stephen (Albanian: Kisha e Shqefnit). The seat of the Episcopate would later be relocated, but the town of Peshkopi retained its name. Peshkopi is referenced as early as the fifteenth century under the name Peskopia.
By the beginning of the sixteenth century, the Ottoman Empire had completed its conquest of Albania. Under the rule of the Ottoman Empire, Peshkopi was a small market town, overshadowed by the larger and more flamboyant Debar, which today lies just over the Macedonian border. The population of Peshkopi was almost completely Muslim by 1583. In 1873 an Ottoman barracks was built in Peshkopi, housing up to 8,000 soldiers.
The Dibër region, including Peshkopi, took part in the uprisings against Ottoman authority that were occurring throughout Albania in the early 1910s. Albanian armed bands captured Peshkopi from the Ottomans on August 16, 1912.
In the aftermath of the breakup of the Ottoman Empire, a Serbian army invaded Dibër and entered Peshkopi in early December 1912. Albanian forces retook the city on September 20, 1913. A Bulgarian army invaded Peshkopi on January 1, 1916. The Austro-Hungarian Empire, an ally of Bulgaria, brought an army to Peshkopi on April 12, 1916 and engaged in punitive house-burnings and executions throughout the region in an attempt to quell local resistance
