Other important bodies of water in Pakundia include the Narsunda River, Banar, Mangalahat as well as the beels of Padmakuri, Bhara, Kahetardia, Chaityakabali, Baranala, Bejurnala, Naothaghya and Digha.

As the forest-dwelling hill people settled here in the 9th to 10th century, tribes such as the Koch, Garo, Hajong, Ahom and Mech emerged as small groups under the feudal kingdoms.

Described as a pure soul (pakwan deha), Malang Shah was buried in his khanqah during his death and the area came to be known as Pakundia (a corruption of pakwandeha).

Sukumar Sen theorises that the name actually comes from the Pakur tree, which is found abundantly in the area, and the term diya (a highland surrounded by water on both sides).

Emperor Aurangzeb granted a jagir of 62 mouzas to Shaykh Muhammad Hanif al-Muhaddith, instructing him to migrate from Delhi to eastern Bengal.

During the Bangladesh War of Independence in 1971, the Bengali fighters fought with the Pakistan Army in areas such as Kaliachapra, Kodalia and Tarakandi.

The status of Pakundia Thana was upgraded to upazila (sub-district) on 14 September 1983 as part of the President of Bangladesh Hussain Muhammad Ershad's decentralisation programme.

Pakundia had a literacy rate (age 7 and over) of 51.79%, compared to the national average of 51.8%, and a sex ratio of 1074 females per 1000 males.