In the first year of the Genji Era (1864), the chief priest of the Hakodate Hachimangu Shrine, Kikuchi Shigeken, petitioned to have Sumiyoshi Okami recognized as the tutelary deity for both the Otarunai and Takashima localities. He was successful, and in June 1865 he began work at an approved nearby location. The following year, however,  a request for a shrine site nearer to the residence of the local daimyo was made and the Shogunate instructed the Otarunai officials to reclaim land from the nearby waterfront for use as the location for a shrine. This was to be financed by a levy on ships entering the port of Otaru. Come the reforms of the Meiji Restoration, however, construction of the shrine was halted and it was moved temporarily to Itsukashima Jinja in Hakodate.

In the first year of Meiji (1868) the shrine Jintai was ceremoniously escorted to Otarunai/Takashima and on its arrival there on August 3 ceremonies were held in both locations. In the same year the shrine itself was moved from Itsukashima Jinja to a place called Ryotoku-cho in Otaru. In 1875 it was given Village Shrine ranking and along with the economic development of Otaru its annual ceremonies became more elaborate each year.  In 1881 fire broke out in Ryotoku-cho: the local authorities saw this as a good chance to rebuild the area’s road network and along with this the shrine was moved to its current location in Suminoe. The shrine’s name had been Sumie Jinja, but in January 1892 it took its current name of Sumiyoshi Jinja. In June 1898 the shrine was granted permission to expand its grounds and rebuild; the work was completed the following year. In November eight years later it was elevated to Prefectural Shrine ranking.