Following the Meiji restoration, the area was organized into villages within Yamagata District, Hiroshima with the creation of the modern municipalities system on April 1, 1889.

Kitahiroshima was formed on February 1, 2005, from the merger of the towns of Chiyoda, Geihoku, Ōasa and Toyohira, all from Yamagata District.

Kitahiroshima has a mayor-council form of government with a directly elected mayor and a unicameral town council of 12 members.

In terms of national politics, the town is part of the Hiroshima 3rd district of the lower house of the Diet of Japan.

The economy of Kitahiroshima is largely based on agriculture and forestry, with seasonal tourism to its ski resorts.