DNA analysis placed the ancestors of today's Shih Tzu breed in the group of "ancient" breeds indicating "close genetic relationship to wolves." Another branch coming down from the "Kitchen Midden Dog" gave rise to the Papillon and Long-haired Chihuahua and yet another "Kitchen Midden Dog" branch to the Pug and Shih Tzu. It is also said that the breed originated in China, hence the name "Lion Dog", in 800 B.C.
There are various theories of the origins of today's breed. Theories relate that it stemmed from a cross between the Pekingese and Lhasa Apso, a Tibetan dog gifted by the Dalai Lama to Chinese emperors near the end of the 17th century. Dogs during ancient times were selectively bred and seen in Chinese paintings. The dogs were favorites of the Chinese royals and so prized that, for years, the Chinese refused to sell, trade, or give any away. The first dogs of the breed were imported into Europe (England and Norway) in 1930 and were classified by the Kennel Club as "Apsos". The first European standard for the breed was written in England in 1935 by the Shih Tzu Club, and the dogs were recategorised as Shih Tzu. The breed spread throughout Europe, and was brought to the United States after World War II, when returning members of the U.S. military brought back dogs from Europe, in the mid 1950s. The Shih Tzu was recognized by the American Kennel Club in 1969 in the Toy Group.
The breed is now recognized by all of the major kennel clubs in the English-speaking world. It is also recognized by the Fédération Cynologique Internationale for international competition in Companion and Toy Dog Group, Section 5, Tibetan breeds. In the United States, the Shih Tzu ranked the 15th most popular breed in 2013, falling slightly in popularity since 2012, when it was placed in 11th position. In 1934 the Shih Tzu Club of England was founded and the breed was officially recognised by the Kennel Club (UK) on 7 May 1940 when it became eligible for Challenge Certificates, none were awarded until 1949.