The origins of the University of Mannheim date back to the Städtische Handelshochschule Mannheim (Commercial College of the City of Mannheim), which was founded in 1907 on the initiative of Mannheim's bourgeoisie. Funded by the Chamber of Commerce, the institution, which functioned as a college for future merchants up to the 1930s, became a center for higher education. The college offered courses in business administration and economics as well as in philosophy, history, arts, and natural sciences. Between the world wars, the college was added an institute for psychology and educational sciences and an institute for interpreters.
In 1933, the Handelshochschule was merged into the University of Heidelberg under National Socialist rule. Only 3 out of 14 Jewish teachers survived the Holocaust. Among the victims was Otto Selz, the head of the institute for psychology and president of the Handelshochschule. Today, the Otto-Selz-Straße, a street that begins at the east wing and goes around the university, commemorates the renowned pioneer of cognitive psychology.