The surrounding forests contain layers of iron ore rich turf, mined for hundreds of years by people who lived in the vicinity.

The settlement of Rudnik was probably founded in the 14th century, after the former Czerwień Cities/Red Ruthenia were reintegranted with the Kingdom of Poland.

Rudnik for centuries remained in private hands; it belonged to the Gnojenski, the Lipnicki and the Ulinski families.

Following the Partitions of Poland, Rudnik was annexed by the Habsburg Empire, and made part of the province of Galicia.

Due to proximity of the Austrian–Russian border, Rudnik became an important crossing point for Polish rebels, fighting in the January Uprising.

Rudnik was almost completely destroyed during World War I, when Austrian and Russian armies fought in the town and its area for six weeks.