The oratory was built in 1569 to replace a former smaller church dedicated to St Lawrence. Construction was funded by a confraternity of mainly Genovese merchants, and linked to Conventual Franciscans. In 1699-1706, Giacomo Serpotta realized a sumptuous stucco decoration, depicting the life of St Francis.
The oratory is particularly famous because of the masterpiece altarpiece Nativity with St. Francis and St. Lawrence (1600 or 1609) by Caravaggio. This important painting was stolen, probably by Cosa Nostra, on October 18, 1969. It has never been recovered. In 2015 a hi-tech replica of the altarpiece was placed inside the oratory.