Andrew and Celia Scott, who arrived in Australia in 1839, established a cattle farm of 16,000 acres (65 km2).

After a period of growing potatoes in 1841-42 during poor financial times, in 1843 the Scott family began to run sheep.

The post office opened on 9 August 1880 as Scott's Marsh, was renamed Scotsburn in 1889 and closed in 1971.

[2] In 1884 the Scotsburn Union Church was formed, with an acre of land donated by Andrew Scott.

A bushfire with an extent of 4600 hectares burned through Scotsburn and surrounding areas on 19 and 20 December 2015, killing livestock and pets and destroying at least twelve houses.