The settlement of Elleholm, once known as Alholmen, is recorded as early as the twelfth century, when it belonged to the Archbishop of Lund. That historic link survives in Elleholm's old town coat of arms, which depicts the gridiron of Saint Laurence, a symbol still found in the arms of the Bishop of Lund.
A chapel is thought to have stood on this site in the later Middle Ages. It fell into disrepair after Elleholm lost the town privileges it had held under Danish rule, and the present church, built using traditional timber-framing (korsvirke) techniques, replaced it, most likely in 1705, though some sources give 1713. The sacristy was added in 1784, and a porch built before 1763 was later heightened, in 1819, to form the bell tower.
The altarpiece, pulpit and a hymn-number board were donated to the church in 1713 by Zacharias Kling and his wife Johanna Maria Welshuysen, then owners of the nearby Elleholm manor. These are thought to be the work of the woodcarver Caspar Ellenburg of Karlshamn, though the carved figures on the pulpit may be somewhat older.
The octagonal wooden font dates from the seventeenth century and is carved in the form of a figure, probably depicting the infant John the Baptist; its red and green painted bowl may originally have belonged to an earlier font. A hexagonal canopy in Renaissance style hangs above it, and the font is recorded as a gift from a parishioner, Jöran Matzon. A crucifix on the north wall dates from the 1500s, and the church's small organ, with six stops, was built in 1981 by Mårtenssons orgelfabrik of Lund.
Among the church's more unusual possessions is a copy of Christian III's Bible, printed in 1550 as the first Bible in Danish, of which only a handful of copies survive; it is now kept in the parish archive in Mörrum rather than in the church itself.