On the southern side of the town, State Highway 96 diverges from SH 1 and runs westward through nearby communities such as Te Tipua and Waitane, ultimately terminating in Ohai.

The closest Māori settlement was the kaika (unfortified village) of Tūtūrau, which was located near the east bank of the Mataura River 3.2 km (2.0 mi) downstream from the present town.

[5][6] In 1854 the Murihiku block of land (which included Mataura) was purchased from local Maori by the Otago Provincial Council, with the objective of developing it up for settlement by immigrants from Great Britain.

By 1856 the Otago Provincial Council had recognised that if development was to succeed a ferry had to be established at the falls to enable a direct overland transport between Dunedin and Invercargill.

This work which damaged the look of the falls was in vain as the bridge was totally destroyed by a major flood on 22 April 1861.

To encourage use of the bridge the council also built the Mataura Ferry Hotel on the west bank of the river.

In 1866 James Pollack won the tender for the lease of the Mataura Ferry Hotel and offered to build a replacement bridge in return for the right to charge tolls for 12 years.

His offer was declined by the Otago Provincial Government who built a replacement bridge of the suspension type, which was opened on 27 August 1868.

Crossing the gorge downstream of the falls it was a more substantial timber structure with 16 supporting cables passing over stone pillars before being anchored in rock.

He also petitioned the government to undertake the first survey of the location which subsequently named the area the Town of Mataura Bridge.

[11] By the 1930s the narrowness of the bridge which restricted travel to one direction at a time and its light construction had become inadequate for the increasing traffic and heavy loads.

[13] The 8000 tonnes of aluminium dross, also known as ouvea premix, if mixed with water would have released clouds of ammonia gas.

It wasn't until 1911 the Borough Council was able to reach agreement with the freezing works for them to increase their generating capacity so that they could supply the Mataura load.

After taking out a loan to finance the expansion of the generation capacity and the installation of a distribution system around the town the first power began being supplied from 5 October 1912.

Mataura retained its own independent power system until 1932 when due to technical issues it became impossible for the freezing works to continue supplying the town.

[33] In the mid-1870s a company led by James Bain was formed in Invercargill to establish a pulp and paper mill on the east bank of the river downstream of the Mataura falls.

To assist them the Government granted the company freehold of land on both sides of the river at the falls, as well as all water rights, which would allow the head to be utilised to provide cheap power to the paper making machinery.

In 1891 the paper mill and the freezing works jointly built a weir to a race to improve the water supply to their respective hydro generators.

[35] Thomas Culling eventually purchased the interests of four of the partners leaving him owner in partnership with J. L. Gregory.

By 1990 the mill, owned by NZ Forest Products, had become a division of Elder Resources, until it was taken over by Carter Holt Harvey in 1991.

Between 1984 and 1991, due to upgrades and efficiency gains, productively had increased by 25% with 216 staff employed at the end of the period.

[39] The Southland Frozen Meat And Produce Export Company (which had been established in 1882) purchased land on the west bank of the river from Thomas Culling (the principal of the Mataura Paper Mills) upon which they built and opened the second freezing (meat processing) works in Southland.

At the time eastern Southland sheep farmers tended to send their livestock by rail to Dunedin for slaughtering and it was intended that the new works would compete for their business.

Due to intensive development and expansion throughout its history, the plant extends for some distance along the bank of the river, sandwiched between it and State Highway 1.

In 1997 Rayonier NZ limited opened on a greenfield site a medium-density fibreboard (MDF) manufacturing plant at Brydone, 8 kilometres south of Mataura.

Renamed as the Patinna mill it specializes in thin and high density fibreboard products with 90% of its output exported.