The most common, and what is now considered to the most likely account, states it was created in Florence in 1919 at Caffe Casoni which is now known as Caffe Cavalli. It began life as an Americano the favoured drink of Count Camillo Negroni.
The Count asked the bartender to strengthen the drink. The bartender added gin instead of the soda. A slice of orange was also added to differentiate the drink from it's predecessor which would normally be garnished with a lemon.
This account gained further repute when Luca Picchi published a book called "Sulle Tracce Del Conte" about the life of Cammillo Negroni, someone many had argued may never have existed. The story goes the Count left Italy after fathering an illegitimate child so decided it was time to open a cattle ranch in the US.
As with some of the most famous classic cocktails, one of the earliest references comes from Orson Welles, who was working in Rome in 1947. He described the drink by saying "The bitters are excellent for your liver, the gin is bad for you. They balance each other" a true philosophy to live by.