It is uncertain how the name was chosen; perhaps in hopes of building a mill, or perhaps in honor of English poet John Milton.

Freewater received its name from the offer of free residential water rights to attract new settlers.

In 1936, a magnitude 6.1 earthquake centered 6 miles (9.7 km) to the northwest caused significant damage in and around Milton-Freewater.

In the late 1970s, agricultural practices and crop prices changed the dynamics of the local economy, and peas were no longer grown as abundantly as they previously had been.

Festival activities have included frog-jumping contests, concerts, karaoke competitions, the corn roast, and a dance.

The Friends of the Library have held a large outdoor book sale at the festival each year since 1993.

[6] The city also has sponsored the creation of more than 50 chainsaw sculpture frogs at local businesses to help market itself as a "fun town" with a quirky nickname.

According to the United States Census Bureau, the city has a total area of 1.99 square miles (5.15 km2), all of it land.