The first people to inhabit the region were the Hurons, Ojibway and Algonquins, who would visit the area in the summer for hunting and fishing but sheltered on Georgian Bay in the winter. While some Europeans explored the region in the early 19th century, settlement and colonization by Europeans was hardly taking place, so much so that the government considered turning the entire region into an Indian reserve.
But when pine stands in southern Ontario became depleted, the area attracted loggers and the government changed its mind and encouraged settlement through free land grants, first offered in 1853. Settlement happened slowly but accelerated when the colonization road from Rosseau to Nipissing began being built in 1866. In 1868, the government passed the Free Grand Land and Homestead Act and began advertising this extensively in European countries to attract new immigrants.Croft Township was surveyed in 1869, Chapman Township in 1870, and the village of Magnetawan was mapped out in 1873.
The Township of Magnetawan was formed in 1998 through the amalgamation of the Township of Chapman and the Village of Magnetawan, along with the unincorporated geographic Townships of Croft and Spence.
Magnetawan in Native language means "swiftly flowing river."