For centuries, Indian people roamed the rivers and streams of the Eatonville area. Indian Henry was one of those, who in 1889, guided the town's founder, Thomas C. Van Eaton, from Mashell Prairie to the present site of Eatonville. It is said that upon arrival, Henry declared, "This good place. Not much snow."

Area settlers and Indians were in need of goods, which "T.C." provided at his trading post. Supplies were carried by his stage from Spanaway over a rough trail through dense forest. In 1891, the settlers built the town's first school, which is still in use.

For years Eatonville was a waypoint for for visitors to Mt. Rainier. In 1902, the Tacoma Eastern Rainlroad arrived, providing freight and passenger service and a vital link to Tacoma. Soon after the railroad's arrival, several small mills sprang up in the vicinity.

The town was incorporated in 1909, after the Eatonville Lumber Company brought in more people to work in its mill. The mill's closure in 1954 was a blow to the town, but community spirit and good schools have kept Eatonville alive and growing.