[2] In 1763, Governor Benning Wentworth of New Hampshire gave a charter for the region to a group of proprietors, and the town was given the name Peacham (the etymology of the name is unclear).

The original proprietors were speculators who surveyed the town, laid a few rudimentary roads, and divided it into lots, though the territory remained unsettled for some time.

In 1775, settlers, primarily from Connecticut and Massachusetts, bought the lots and built homes, developing the land for agriculture.

The original settlers survived almost entirely through subsistence farming despite the long winters, hilly terrain, and rocky soil.

[3] A congregational church was founded in 1794—the first pastor, Leonard Worcester, was well known for his fiery sermons.

Early residents, who came to be known as Peachamites, traded butter, eggs, and wheat for goods which they could not make at home, and also relied on the production and sale of items such as whiskey and potash to help augment the relatively poor harvests.

The larger, more industrially advanced farms of the late 19th century could not support large families, and youth began to leave home.

Tourism became important during the 20th century as people opened their homes to visitors from the cities of the Atlantic seaboard, often derisively referred to as "flatlanders".

With the advent of the railroad in Barnet and then motor vehicles, Peacham became a popular location for summer residents, some of whom were educators from Boston and New York City.

In the second half of the 20th century, Peacham became a popular vacation spot and retirement home for prominent intellectuals and liberal thinkers—individuals such as David Dellinger, William Lederer, Roman Jakobson, and the historian Shepard Clough all owned houses in town.

[citation needed] Neighboring towns are Danville to the north, Barnet to the east, Ryegate to the southeast, Groton to the south, Marshfield to the west, and Cabot to the northwest.

The highest point in Peacham is the 2,566-foot (782 m) summit of Cow Hill near the northern corner of town.