In the early 19th century when the first white settlers arrived, the Shorewood area was controlled by Native Americans, including the Menominee, Potawatomi, and Sauk people.

The United States Federal Government traded the land from the Menominee people in 1832 through the Treaty of Washington.

[4][5] The land was organized as part of the Town of Milwaukee in 1835,[6] and when settlers arrived in the mid-1830s, they found the area to be heavily forested.

Thomas Bare, the area's first permanent white settler, arrived in 1841 and purchased ninety acres of farmland east of the Milwaukee River.

In 1873, the Northwestern Union Railway laid tracks through present-day Shorewood along the eastern bank of the Milwaukee River.

The railroad was a boon for local businesses, including the Milwaukee Cement Company, which began quarrying limestone on the bluffs above the river in 1876.

Accessible by riverboat and later by train, the resort was the first of several beer gardens and amusement parks that operated in the area between the 1872 and 1916.

Coney Island, an amusement park that opened in 1900, proved to be particularly controversial and played a significant role in Shorewood's incorporation as a village.

Some blamed the Town of Milwaukee, which collected licensing fees from the park and allowed it to operate.

[7] Additionally, the roads in the community were of poor quality compared with those in the neighboring city of Milwaukee, and residents were unhappy that tax revenue from the increasingly suburban Shorewood area—including the taxes from Coney Island—were being redistributed across the town rather than being used to increase their standard of living.

[5] In the early 1900s, the village developed as a streetcar suburb of Milwaukee, with public transportation allowing residents to easily commute to the city.

The village's center emerged along the streetcar lines on Oakland Avenue and Atwater Road (now known as Capitol Drive).

[4] The population grew to 1,255 by 1913, and in the 1910s municipal improvements included paved roads and sidewalks, gas mains, and street signs.

The community underwent urban renewal projects beginning in the 1960s, but the population has slowly declined to approximately 13,000 as of 2010.

According to the United States Census Bureau, the village has a total area of 1.59 square miles (4.12 km2), all of it land.