The village core was designed in the 1930s as part of a New Deal program to establish so-called "greenbelt towns" as model suburbs, and is one of three such communities built by the federal government.

Milwaukee, Wisconsin was chosen for its varied and stable manufacturing sector, among other reasons, and Greendale was built west of the city.

During its construction, First Lady Eleanor Roosevelt visited the project and later wrote that it had a "delightful site" and thought it was a "really good development.

[2] Greendale was one of three 'greenbelt towns' built by the federal government of the United States, along with Greenbelt, Maryland outside Washington, D.C. and Greenhills, Ohio outside Cincinnati, during the Great Depression.

Its layout, as designed in the 1930s, has circulation patterns for both vehicular and non-vehicular movements, winding roads providing access to single-family and duplex homes, and a central business district that also houses municipal functions.

The residential buildings are typically two stories in height, with concrete cinder block walls finished in stucco on the outside and plaster on the inside.