The Umbrella Corporation was founded by Lord Ozwell E. Spencer, a man descended from the British Royal Family, in the 1960s. Two other people were prominently involved in the conception of Umbrella, Dr. James Marcus and Sir Edward Ashford, although it is apparent that Spencer was the driving force behind the formation of the company as Marcus and Ashford were far more interested in the potential uses of the newly-discovered Progenitor Virus. When Ashford died in 1968, Spencer was able to largely sideline Marcus at the Raccoon City facilities while he maintained control over the company for the next thirty years. Spencer would eventually grow distrustful of Marcus, worried that his research would allow the scientist to eventually supplant him as Umbrella's CEO.
The B.O.W. Development Team at the Arklay Research Facility.
Lord Spencer arranged for the assassination of Dr. Marcus, a task that was duly carried out by two of Marcus' most brilliant and ambitious assistants, William Birkin and Albert Wesker. Birkin would subsequently take over all of Marcus' research, including the studies on the Progenitor Virus and his achievement in the creation of T. Ten years later, Marcus was completely restored by the Queen Leech (see James Marcus for more information regarding this event). Marcus would exact his revenge on Spencer and Umbrella by releasing the T-Virus into the Arklay Research Facility's water supply, turning the facility personnel into zombies and leaving the laboratory and mansion in complete chaos, allowing for the team's extremely dangerous research specimens to escape into the surrounding area. Birkin and Wesker used this as a diversion for their own plans to leave Umbrella, taking their research with them. Wesker, having formed Raccoon City's elite S.T.A.R.S. unit two years previous, would develop a plan to lure the team to the Spencer Mansion to obtain battle data from the conflict that would surely follow. Spencer Mansion had been constructed above the actual laboratory to conceal it from negative interests such as the government and local populace, and was now crawling with infected researchers and experiments wandering its halls. Although the Tyrant was deployed, resulting in unforeseen side-effects for Wesker, both the laboratory and the rampaging Tyrant were destroyed by S.T.A.R.S. Alpha Team before making its escape back to Raccoon City with a single Bravo Team survivor.
Wesker was forced to go into hiding for a number of months, using his operative Ada Wong to carry out his objectives, including the recovery of Birkin's ultimate creation, the G-Virus. Several months after the Arklay incident, William Birkin finally perfected the viral strain that he'd been toiling to achieve since obtaining Marcus' research so many years earlier, the G-Virus. Birkin planned to use the virus to force the Umbrella Corporation into allowing him onto their executive board, but then changed his plans when he found that selling it directly to the U.S. Government would prove far more profitable. Umbrella deployed its elite U.S.S. team (a para-military black-operations unit created for Umbrella's most clandestine purposes) in a desperate bid to stop Birkin from handing over his ultimate creation. Although Birkin was mortally wounded in the ensuing conflict, and the G-Virus was successfully recovered by Umbrella, he was able to inject the G-Virus into his own body and devastate most of the team before it could make its escape. This event would be indirectly responsible for unleashing the T-Virus on Raccoon City. While the Arklay incident had been relatively isolated and concealed from the public, and Umbrella's control over key government and law enforcement personnel had ensured that any record of what had occurred could be safely swept into obscurity, they were now faced with an entire city infected with the T-Virus and a trail leading directly back to the Umbrella Corporation. This would prove exceedingly difficult, even for Umbrella, to make simply disappear.
 Decline and Collapse===
The T-Virus and anti-virus as seen in Resident Evil.
Umbrella's fortunes failed to improve in the time shortly after the Raccoon City incident. But with a barrage of mysterious witness disappearances and Umbrella-planted witnesses, all blame for the incident was carefuly shifted to the US Government. The U.S. Government was forced to take extreme measures to ensure the spread of the T-Virus was stopped for good. Mission Code XX was approved for immediate deployment, and Raccoon City was annihilated via an air-to-surface surgical missile strike. After escaping to the city limits with the UBSC member Rodrigez and her fellow Umbrella researcher Linda, Yoko Suzuki's amnesia finally lifted, and all of the evil deeds she had witnessed and helped Umbrella keep secret came flooding back. With her newly regained memories, Yoko decided it was time the world was told the truth, and that doing so would start her down a better path. Linda and Yoko were brought forward as key witnesses to Umbrella's atrocities in the Supreme Court, and all was made known.
On Sheena Island, undercover investigator, Ark Thompson, operating on behalf of Leon S. Kennedy, succeeded in destroying Umbrella's Tyrant production plant after Umbrella's senior executive assigned to the island unleashed the T-Virus on its citizens. Shortly afterwards, when Claire Redfield broke into Umbrella's Paris facilities in search of her brother, she was captured and sent to Umbrella's illegal prison camp on Rockfort Island. While there, she witnessed Albert Wesker attack the island in search of the T-Veronica Virus, another relative of the now infamous T-Virus. Escaping the island, she found herself trapped at the South Pole Facility, where Edward Ashford's granddaughter, Alexia Ashford, awoke from a self-induced coma with a desire to establish a new order. With the destruction of Sheena Island, Rockfort Island and the South Pole Facility, most of Umbrella's illegitimate operations had been shut down. This, combined with the loss of so many of Umbrella's research and security personnel throughout each of the disastrous incidents, left Umbrella with little chance of reforming said operations or regaining the years of research lost thus far.
However, the Umbrella investigation would continue until 2003, when Umbrella was finally found guilty after an anonymous tip-off by Albert Wesker. The U.S. Government suspended Umbrella's market trading license pending further investigation into their business practices. While this investigation must have already provided Umbrella with severe financial problems, a world-wide manhunt for surviving founder Ozwell E. Spencer practically sealed the organization's fate.
With trading suspended, Umbrella's shares quickly collapsed, and the company was virtually bankrupt. Umbrella became largely fragmented, with power struggles between senior executives becoming a constant occurrence. The U.S. STRATCOM was mainly involved in clean-up operations, such as the theft of the T-G Virus by former Umbrella executive in R&D, Morpheus D. Duvall, and his plans to create a new order based around his obsessive ideals of 'beauty'. By the early 21st century, the Umbrella Corporation's bankruptcy was absolute, and the U.S. government had completed the process of fully dismantling the remnants of the organization. However, in Resident Evil 4, it was revealed that Albert Wesker's grand scheme involves the resurrection of the Umbrella Corporation.
Even with the corporation shut down, a vast amount of technology developed by the was pilfered and scattered across the globe. Among this Umbrella technology were satellites, artificial intelligences, and energy weaponry. Wesker is, however, seen in RE4 as controlling an Umbrella-owned satellite, and retrieving the data contained within the Red Queen in RE:UC. This poses the possibility he has seized all of Umbrella's technology, assets and intelligence data for his own organization.