Following the sacking of Ayuthaya by the Burmese in 1767 (see Thai History), the Siamese were reunited by General - later to be King - Taksin, who established the new capital in Thonburi on the west bank of the Chaophraya river opposite where Bangkok is today. Taksin's successor, King Chakri (Rama I) decided to move the capital across the river to a more defensible location.
The name "Bangkok" derives from the name of a village that occupied the site before the new capital was founded. The proper name of the city is one of the longest place names in the world, but is generally shorted to Krungthep.
Bangkok Story of a City
This book qualifies as a "must read" for almost any long term visitor to Thailand. Bangkok Story of a City by Alec Waugh is a highly readable history of Bangkok, although the focus is really on the Chakri dynasty who founded the capitol 200 years ago. With enough court intrigue, popular uprisings and revolutions to match any Hollywood epic, its hard to put down. Although it was originally published in 1970 it still gives you a very real insight into what makes Thailand tick. You can order a copy from amazon.com or if you're in Thailand, local reprints are available in some bookstores around Bangkok.