In the 4th century, Emperor Valentinian was cured at the shrine of Caesarius at Terracina, the site of his martyrdom. The emperor then decided to move his relics to Rome. They were taken to a church on the Palatine Hill, and when they were later moved to a new church, that church got the name "in Palatio", "at the Palace". It is also known as San Cesareo de Appia. Excavations have revealed a Roman bath on the site from the 2nd or 3rd century, with a huge black and white mosaic depicting Neptune and marine creatures, along with foundations of what is thought to be the first church here, built in the 8th century.
Medieval
No written evidence exists for the church's origins; it is first mentioned in the written sources is 1192. In the Middle Ages, the church was part of a hospice and hospital for pilgrims, and had a column in front of it to demonstrate this.
The present church is the result of reconstruction work undertaken in 1602/3, supervised by the great historian Cardinal Cesare Baronio, who was then titular here and whose house survives. The coat-of-arms of the reigning Pope Clement VIII, who was of the Aldobrandini family, was added to the coffered ceiling. The central panel of the latter depicts St Caesarius. Though they have now been lost to pollution, at this same period frescoes were added to the facade, which is the work of Giacomo della Porta. The Cosmatesque pulpit, the balustrades, the altar frontal and episcopal chair behind the altar may have been brought here at this time from San Giovanni in Laterano, when work was undertaken at this period in the transepts there, although possibly they came from other churches. The paintings between the windows are also 17th century, by Cavalier D'Arpino and Cesare Rosetti, and depict the martyrdoms of St Caesarius and of several saints named Hippolytus, a compliment to Pope Clement VIII, whose baptismal name was Ippolito. It was Cavalier D'Arpino who also produced the design for the rare motif in the mosaic, God the Father.
20th century
Another restoration occurred in the years 1955 to 1963. John Paul II was the titular cardinal of this church.