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The Roku 3 contains an upgraded CPU over the 2 XS, and a Wi-Fi Direct remote with an integrated headphone jack. Roku unveiled its third-generation models in March 2013, the Roku 3 and Roku 2. Later in October, Roku introduced a new search feature to the second-generation models, aggregating content from services usable on the device. In January 2012, Roku unveiled the Streaming Stick - a new model condensed into a dongle form factor using Mobile High-Definition Link (MHL).

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The Roku LT was unveiled in October, as an entry-level model with no Bluetooth or microSD support. They also support the 'Roku Game Remote'-a Bluetooth remote with motion controller support for games, which was bundled with the XS and sold separately for other models. The XD and XS support 1080p, and only the XS model includes an Ethernet connector and USB port. All three models include 802.11n, and also add microSD slots and Bluetooth. In July 2011, Roku unveiled its second generation of players, branded as Roku 2 HD, XD, and XS. Support for the first-generation Roku models ended in September 2015. The XD and XDS also included an updated remote.

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The next month, they released an updated lineup with thinner form factors: a new HD the XD, with 1080p support and the XDS, with optical audio, dual-band Wi-Fi, and a USB port. In August 2010, Roku announced plans to add 1080p video support to the HD-XR. In May 2010, the channel was updated to allow users to search the Netflix library directly from the device. Netflix support was initially dependent on a PC, requiring users to add content to their 'Instant Queue' from the service's web interface before it could be accessed via the Roku.

The next month, they introduced the Channel Store, where users could download third-party apps for other content services (including the possibility of private services for specific uses). By then, Roku had added support for other services. The Roku DVP was retroactively renamed the Roku HD. Roku launched two new models in October 2009: the Roku SD (a simplified version of the DVP, with only analog AV outputs) and the Roku HD-XR, an updated version with 802.11n Wi-Fi and a USB port for future functionality.

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It features an NXP PNX8935 video decoder supporting both standard and high definition formats up to 720p HDMI output and automatic software updates, including the addition of new channels for other video services. The goal was to produce a device with a small footprint that could be sold at low cost compared to larger digital video recorders and video game consoles. It was developed in partnership with Netflix to serve as a standalone set-top box for its recently introduced 'Watch Instantly' service. The first Roku model, the Roku DVP N1000, was unveiled on May 20, 2008. In 2019, Roku acquired dataxu, an advertising technology company for $150 million.

In 2015, Roku won the inaugural Emmy for Television Enhancement Devices. In 2014, Roku partnered with smart TV manufacturers to produce TVs with built-in Roku functionality. In 2010 they began offering models with various capabilities, which eventually became their standard business model. Netflix decided instead to spin off the company, and Roku released their first set-top box in 2008. Fast Company magazine cited the decision to kill the project as 'one of Netflix's riskiest moves'.

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Only a few weeks before the project's launch, Netflix's founder Reed Hastings decided it would hamper license arrangements with third parties, potentially keeping Netflix off other similar platforms, and killed the project. In 2007, Wood's company began working with Netflix on Project:Griffin, a set-top box to allow Netflix users to stream Netflix content to their TVs. After ReplayTV's failure, Wood worked for a while at Netflix. Roku was founded by Anthony Wood in 2002, who had previously founded ReplayTV, a DVR company that competed with TiVo.