The community is located in an area where there is an historically large settlement of Old Order Mennonites noted for their traditional customs, dress, and use of horse and buggies.

Although the land on which Floradale is located was purchased by prospective settlers in 1808, there was no significant development until a flour mill and sawmill were built in the later part of the 1800s.

The early inhabitants of the area established Mennonite, Lutheran, and Evangelical churches.

Although the mill is no longer in operation, a hole in the building’s north wall allows visitors to view the working equipment of what is thought to be Ontario’s last overshot water wheel.

In 1863, the settlement was named Flora, and in 1876, 'dale' was added to avoid confusion with nearby Elora.