By the late 17th century, Europeans may have entered the area as a result of the establishment of the Dutch patroonship owned by Kiliaen van Rensselaer, the Manor of Rensselaerswyck, which extended west and east out of Albany and the fur trading community of Beverwyck.

In 1766, 185 male heads of households in Pownal sent a petition to George III, asking that their land claims be recognized and that the fees required to do so be waived.

As a result, a number of Pownal residents joined the Green Mountain Boys under Ethan Allen.

By the American Revolution, the town was deeply divided between "Yankees" and the Tories, those sympathetic to England, each of whom considered himself or herself a Loyalist.

These tensions were strong enough that when British General John Burgoyne's Saratoga campaign brought conflict to the area, Vermonters fought on both sides.

William Card, originally of Rhode Island, fought for the British at the Battle of Bennington along with four of his sons: Jonathan, Elisha, Philo (or possible Peleg), and Stephen.

[6] The battle, a virtually complete American victory, resulted in the capture of the elder Card and all four of his sons, but they were soon released.

[7] By the end of the Revolution, most Tories had fled Pownal for safety among the United Empire Loyalists who resettled in Canada.

The novel Memoir of a Green Mountain Boy starts and ends in Pownal during the early years of the Revolution.

[4] On the Hoosic River in North Pownal, an 18th-century gristmill was replaced by a woolen mill that operated from 1849 until 1863, when it burned.

During the early part of the 20th century, muckraking photographer, Lewis Hine, took a photograph of twelve-year-old Addie Card working in the mills, which Hine labeled as, "Anemic Little Spinner in North Pownal Cotton Mill, North Pownal, Vermont, August 1910".

The Berkshire Street Railway Company began trolley service from Williamstown to Bennington via Pownal on June 27, 1907.

A rail car line extended from the southernmost quarry to the mill on the west side of Route 346, where the stone was crushed and packaged for shipment.

[13] Since closing as a racetrack, the site has hosted live events occasionally, including a rock concert in the Lollapalooza series in 1996, and antique car shows from 2005 to 2008.

Ilium is notable because on September 10, 1910, S. F. Lester of Troy, New York, became the first person to hold the Scouting leadership position of Scoutmaster (approved by the BSA).

Camp Ilium was the starting point of the Boy Scout Movement for Pownal and Troy, New York.

[15] Pownal is the southwesternmost town in Vermont; it is bordered by Williamstown, Massachusetts, to the south and Petersburgh, New York, to the west.