Pelham (/ˈpɛləm/ PEL-əm; the "h" is silent) was part of the Equivalent Lands compromise, and was first settled in 1738 by mostly Presbyterian Scotch-Irish immigrants.

The rebellion, planned in Conkey's Tavern in town, drew support from many towns in central and western Massachusetts, but it met its practical end when the angry farmers' force refused to fight Governor Bowdoin's army and they were dispersed in a rout in nearby Petersham.

Pelham also holds the distinction of having the oldest town hall in continuous use in the United States.

Originally a much larger town, rectangular in shape (except for a small extension southward taking up part of the modern area of Knight's Corner) and extending eastward to the top of Prescott Hill (where Daniel Shays once lived), the land east of the West Branch of the Swift River was annexed by the town of Prescott in the latter half of the nineteenth centuries (maps made in 1855 and 1862 both show this land still belonging to Pelham).

The reservoir filled along the river, and protected lands along its edge became part of the Quabbin Reservation.

On March 23, 1860, a young man named Warren Gibbs, who lived in the town, died after eating some oysters prepared for him by his wife, Mary Felton.

(Prior to the formation of the Quabbin Reservoir, the town of Prescott was the northeast corner of the county, but its lands were absorbed by New Salem.)

Pelham is bordered by Shutesbury to the north, New Salem to the east, Belchertown to the south and Amherst to the west.

U.S. Route 202, which was rerouted due to the Quabbin Reservoir project along the Daniel Shays Highway, runs through the eastern side of town.

Students in Pelham then attend Amherst Regional Middle School for grades six through eight, followed by Amherst Regional High School for grades nine through twelve.. As of 2000, the US census[15] records there were 1,403 people, 545 households, and 382 families residing in the town.