According to a medieval ballad, the chapel takes its name from a boy called Arvid, later known as Arild, who was murdered by his envious stepfather and set adrift in a burning boat. His body washed ashore and, once found by his grieving mother, she had him buried and built a chapel on the spot in his memory. This legend is the traditional account of the chapel's origin, though documentary evidence points elsewhere: a papal letter of 1475 records that the chapel had been founded by Barbara Torkildsdatter Brahe, of the Bollerup and Krapperup estates, or by her relatives, and that pilgrims visiting it could receive indulgences.
The older, roughly square western part of the chapel is thought to have been built between about 1461 and 1475, with an eastward extension added later in the century giving the building its present size. It served the fishermen who gathered seasonally at Arild for the autumn herring fishing; by the mid-1500s Arild was the largest fishing settlement in the parish, with around forty families, far outnumbering the neighbouring village of Mölle. The chapel is thought to have belonged to the Archbishop of Lund before passing into the ownership of the Krapperup estate, which held it until 1925.
Little medieval furnishing survives beyond a brick-built altar and a carved wooden bench. A thorough renovation between 1736 and 1744 brought the altarpiece — attributed to the painter Johan Henrik Scheffel and depicting the crucifixion — along with marbled paintwork on the fittings. From the same period comes the chapel's oldest votive ship, a model galeas said to have been donated by a Helsingborg ferryman. A further large-scale renovation around 1900 saw the interior painted brown throughout; the original marbled decoration was uncovered again roughly fifty years later.//The chapel bell was recast in 1772, a gift commemorated by an inscription.
Among the chapel's curiosities is a small glass jar said to contain fragments of Saint Arild's shirt, though this, like much of the legend, rests on tradition rather than firm record. The chapel is surrounded by a small burial ground reserved, unusually, for the bodies of drowned persons washed ashore. In 1921 a Catholic chapel modelled as a smaller copy of Arilds kapell was built nearby at Villa Arildshus, decorated with paintings depicting the Arild legend and various saints.