Until the middle of the 12th century, the region lay in the primeval forest known as the Miriquidi, which covered large parts of what is now southern Saxony and stretched across the ridge of the Ore Mountains to northern Bohemia.

Falkenau was first mentioned in 1378 in a tax register of the socalled "Castrum Schellenberg" district, but the first settlers probably arrived as early as the late 12th century in the course of the Medieval Ostsiedlung.

The oldest family names of these farmers were Richter (1546), Rudolph (1563), Ruttluff (1563), Schubert (1563), Kunz (1564), Teufel (1566), Wächtler (1567), Hartwig (1580), Förster (1583), Aßmann (1586), Ranfeld (1585), Becker (1585), Schnorr (1589), Naumann (1599), Fintzel (1593), and Barthel (1595).

Small ore mining endeavours were undertaken in the northern forests of Falkenau along the Zechengrundbach with a first phase during the late 16th century and a second one from 1674 till 1842.

In 1722, the post office of Electoral Saxony erected on behalf of Augustus II the Strong a numbered milestone along the historic Frankenstraße.