The land where the village lies is said to have been granted by William the Lion to Calum Cormack in 1169, who gave the church, with the tithes and other property belonging to it, to the monks of Kelso, in whose possession it remained till a short time prior to the accession of Robert Bruce.

The land subsequently became the property of a younger branch of the Maxwell family, who granted the advowson and tithes to the monks of Dryburgh Abbey, who held them until the Reformation.

It is thought derive either from the Brittonic language words corresponding to modern Welsh pen ('head, top, hill'), coed ('wood'), and llan ('clearing, enclosure'), in which case it once meant "head of a clearing or enclosure in or near a wood", or pen and coedlan ('copse'), in which case it meant "end of the copse".

[citation needed] 1⁄2 mile (800 metres) northwest of Pencaitland is Winton Castle, the original square Tower house being built in the 15th century on land granted to the Setons by David I c1152, and mentioned in a charter to them from William the Lion in 1169.

Architecturally, Winton is one of the most important houses in Scotland, due largely to the work of William Wallace, who was appointed the King's Master Mason in 1617.

Another room, called the King's Chamber, is said to have been occupied by Charles I when he came to Scotland to be crowned in 1633, although most records have him staying at Seton Palace.

Thinking that better times were now at hand, the Earl of Winton caused to be carved on a fine stone tablet upon the frontispiece of his new building a crown supported by a thistle between two roses, signifying the union of Scotland and England.

Under it he caused to be inscribed in deep letters of gold this Latin verse: Unio Nune Stoque Cadoque Tuis.

The Earl's capture ended an era when kings were entertained and master craftsmen were engaged fresh from Edinburgh Castle to embellish Winton House in the style of the Scottish Renaissance.

[citation needed] 3⁄4 mile (1.2 kilometres) south-west of Pencaitland is Fountainhall, a late 16th-century mansion extended in the early 17th century on the same intimate scale and with the same materials, fine-grained harlings matching the pale yellow sandstone of the chimneys, crowstep gables, and other dressings.

On 13 August 1681 the estate was purchased by John Lauder of Newington, a rich Baillie of Edinburgh, for whom the house and lands were erected into the feudal barony of Fountainhall, becoming the seat of that family.

After the Lauders finally parted with Fountainhall in the 1920s, the removal of a lath-and-plaster wall revealed a tapestry in situ, dating from about 1700.

The Royal Commission on the Ancient and Historical Monuments of Scotland suggests that the two buildings flanked an 18th-century pedestrian access to the house.

[12] Former Ministers include David Calderwood (1575–1650) and Robert Douglas (1594–1674), one time leader of Scotland's moderate Presbyterians.

Located a short distance from the village is Glenkinchie distillery, which produces Scotch whisky, marketed by Diageo as part of their Classic Malts range.

The Gifford Circle route (123) run by Eve Coaches also connects Pencaitland with Haddington and other villages in East Lothian.