In 1865, the Murphy family left New York for California. En-route they stopped in Faribault, Minnesota due to the threat of conflict with Native Americans along the route. After most of the family died, Catherine Murphy's dying request was to provide for a Catholic education for the children. In response, Bethlehem Academy was founded by nuns from St Clara's Academy in Wisconsin.[11]
The school opened inside the convent, then moved to a home in 1896. The bottom story consisted of four rooms, including the school room on the first floor with two dormitories and a chapel upstairs.[12]
In 1874 a new site was purchased, and a new three-story brick building was opened on June 1, 1876. In 1900 the North wing was added, and a three-story South wing was opened in 1908.[13][12]
In 2014 the school celebrated its 150th anniversary.[14]
Bethlehem Academy has a total of 7 Minnesota Class A Volleyball State Championships (2003, 2005, 2007, 2009, 2011, 2012, 2014).[16]
In 2012 they were the Minnesota Class A State Runner up, losing 14–20 to Mahnomen High School in Prep Bowl XXXI.[17]
In 2018, coach Franz Boelter was fired for mistreating athletes emotionally. At the time he had coached the volleyball team to seven state championships and was the ninth-winningest coach in Minnesota high school history.[18]