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St. Mary's Abbey, a Benedictine community, was built as the result of patronage by the king in 1088, on the site of an older religious foundation. It lay just outside the city wall, which provided its eastern boundary, in its own walled precinct. This proximity to the city and the fact that the abbey liberty was outside city administration almost inevitably meant that there would be conflicts between abbey and city officials over territorial (e.g. rights on common land outside the walls, right-of-way through the liberty along the wall) or jurisdictional (e.g. freedom from tolls and murage, rights to hold inquests within the liberty), and personal disputes between abbey tenants and citizens. In the mid-1440s the city was suing the abbey in regard to fishgarths placed in the section of the Ouse adjacent to abbey-owned land; these obstructed river navigation and therefore affected water-based commerce. The city paid out over £250 in legal costs in this dispute, necessitating special taxes upon the citizens to cover the expense.

Cathedrals, monasteries and abbeys – initially Benedictine, but joined in the twelfth century by Augustinian houses – were a part of the ecclesiastical element in many of the larger towns. Although, unlike parish churches and the orders of friars, they were not as popular with townsmen, in part because they were rivals for commerce and authority, and in part because monks were considered too worldly – in contrast to the more austere friars who won the townspeople's respect. On the other side of the fence, monastic communities found that the worldly temptations presented by urban society made it difficult for them to exist in that environment.

The ruinous remains of St. Mary's Abbey date mostly from the thirteenth century. Today they provide a backdrop for the medieval mystery plays associated with York (which originally were staged at various points in the city streets).