Kenwood, formerly known as Lower Hollow or Rensselaer's Mills, dates to the earliest Dutch settlement in the area now known as New York's Capital District.

Robert Van Rensselaer lived in a house on the turnpike near the bridge that carried the road over the Normans Kill.

Businessman Joel Rathbone bought a 1,200-acre (4.9 km2) densely wooded area and built a grand Gothic mansion in 1841 for his retirement.

[11] In 1870, the city of Albany annexed a portion of Kenwood (including the first mile of the turnpike, the toll-gate, and the Rathbone estate).

Albany annexed much of the land in Bethlehem north of the Normans Kill, thereby making that creek a natural border between the two municipalities.

[16] In 1859, the Female Academy of the Sacred Heart (a Catholic institution) bought the Rathbone estate and related structures, along with 53 acres (210,000 m2) of land.

[18] Following the departure of The Doane Stuart School, the former Kenwood Academy campus, consisting of 74 acres (300,000 m2), was listed for sale in 2009.

[19] In 2010, the Preservation League of New York State declared the campus to be one of its "Seven to Save" endangered historic sites for that year.

[24] Speaking about the Kenwood Academy fire, Albany Mayor Kathy Sheehan said, "'We lost a treasure here and it’s challenging, it’s frustrating'".