The band was founded in 1968 by Martin Quittenton (guitar) and Kieran White (vocals, guitar, harmonica). The first stable lineup consisted of Quittenton, White, Martin Pugh (guitar), Steve Davy (bass), and Michael Rushton (drums).

This version of the band acted as backing band for Freddie King on one of his tours of England. The band's first album, the eponymous Steamhammer (aka Reflection), was released in 1969. It included covers of "You'll Never Know" by B. B. King and "Twenty Four Hours" by Eddie Boyd as well as original songs by White, Quittenton, and Pugh. Session musicians Harold McNair (flute) and Pete Sears (piano) also played on the album.

This album was not commercially successful, but the band became a popular live act, especially in West Germany. In the summer of 1969, Quittenton and Rushton left the band, and Steve Jolliffe (saxophone, flute) and Mick Bradley (drums) joined the band.

This version of the band recorded the album Mk II, released in 1969. It consisted entirely of original songs, and the musical style had more jazz and progressive rock influences. Jolliffe left the band in 1970. The remaining band members recorded the album Mountains, which was released in 1970. This album included a cover of "Riding on the L & N" by Lionel Hampton and seven original songs.

In 1971, White and Davy left the band, and Louis Cennamo (bass) joined the band. This lineup, along with session vocalist Garth Watt-Roy, recorded the album Speech, which was released in 1972. It consisted of three long, mostly instrumental songs.

Bradley died of leukemia on February 8, 1972, aged 25. A memorial concert took place at London's Marquee Club on March 14, with appearances by fellow bands Atomic Rooster, Beggars Opera, If, and Gringo). Steamhammer carried on for a while with a new drummer, John Lingwood, and a lead singer, Ian Ellis (ex-Clouds). The new line-up debuted at London's Imperial College on May 3, followed by a European tour in May and UK tour in June with American vocalist/guitarist Bruce Michael Paine replacing Ellis. In June 1973, it was announced that they would now perform as Axis, playing their first gig under that name at the Marquee on June 15. Quittenton rejoined, but the band split towards the end of 1973.

Post-Steamhammer: Pugh and Cennamo went on to play in Armageddon. After that band broke up, Cennamo joined Illusion and later worked with Jim McCarty in Stairway. White recorded a solo album, Open Door, which was released in 1975. White died in 1995 following an unsuccessful fight against cancer. Quittenton played guitar and co-wrote songs, including Maggie May and You Wear It Well on albums by Rod Stewart. Jolliffe joined Tangerine Dream in 1978 and played on the album Cyclone. Pugh appears to have been inactive in music after 1975, he did emerge to play guitar on sessions with American rock & roll band, 7th Order[1] on their debut CD, The Lake of Memory - released in 2007.