It is all that remains of the Romanesque church of San Esteban, founded in 1086 to commemorate the Castilian victory over the Almoravid Alí. The tower is Gothic, from the 13th century, and the clock was placed in it in the 19th century. It has been declared an Asset of Cultural Interest since 1981.

The Clock Tower enjoys a perpetual link with Peñafiel, as it is the oldest preserved building in the town.
Due to its peculiar characteristics, this building had a dual function: that of defensive use and that of housing the bells that called the faithful of the San Esteban neighbourhood, one of the first districts of Peñafiel.
The Church of San Esteban was one of the first religious enclosures in Peñafiel and one of the most important churches in the region until the 15th and 16th centuries. However, those times of splendour came to an end and the church was abandoned in the mid-17th century, when it was dismantled. All that remains of its historical and artistic legacy are some stone walls attached to the tower, several buttresses, various remains that have been found in works carried out, as well as a Romanesque stone virgin that is currently on display in the Regional Museum of Sacred Art in Peñafiel.
As the tower was the only vestige of the Church of San Esteban, the watchtower changed ownership and passed into municipal hands, although different religious symbols were preserved, such as the iron cross that crowns it.
The name of this building as the Clock Tower is relatively new, as it was in the 19th century when the Council of Peñafiel installed a clock at the top of this part of the tower, and from that moment it became known as the Clock Tower of Peñafiel.