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Alfred Davis and his brother-in-law Hans Wilsdorf founded Wilsdorf and Davis, the company that would eventually become Rolex SA, in London, England in 1905.[4] Wilsdorf and Davis' main commercial activity at the time involved importing Hermann Aegler's Swiss movements to England and placing them in high-quality watch cases made by Dennison and others. These early wristwatches were sold to jewellers, who then put their own names on the dial. The earliest watches from Wilsdorf and Davis were usually hallmarked "W&D" inside the caseback.

In 1908[5] Wilsdorf registered the trademark "Rolex" and opened an office in La Chaux-de-Fonds, Switzerland.[4] The company name "Rolex" was registered on 15 November 1915. The book The Best of Time: Rolex Wristwatches: An Unauthorized History by Jeffrey P. Hess and James Dowling says that the name was just made up.[6] One story, never confirmed by Wilsdorf, recounts that the name came from the French phrase horlogerie exquise, meaning "exquisite clockwork"[7] or as a contraction of "horological excellence". Wilsdorf was said[by whom?] to want his watch brand's name to be easily pronounceable in any language.[8] He also thought that the name "Rolex" was onomatopoeic, sounding like a watch being wound. It is easily pronounceable in many languages and, as all its upper-case letters have the same size, can be written symmetrically. It was also short enough to fit on the face of a watch.[8]