The first municipality named Forshaga was a market town (köping) which was detached from Grava in 1944.

The local government reform of the 1970s made Forshaga a unitary municipality in 1971 and in 1974 Ullerud was added to it.

Forshaga was known in the 14th century as a location for salmon fishing in the river Klarälven.

Forshaga is still known for its rich fishing waters, which attract hobby sport fishers from all over the country.

This is a demographic table based on Forshaga Municipality's electoral districts in the 2022 Swedish general election sourced from SVT's election platform, in turn taken from SCB official statistics.