The Potawatomi surrendered the land that became Germantown to the United States Federal Government in 1833 through the 1833 Treaty of Chicago, which (after being ratified in 1835) required them to leave Wisconsin by 1838.

[6][7] While many Native people moved west of the Mississippi River to Kansas, some chose to remain or return after temporarily settling in the west, and were referred to as "strolling Potawatomi" in contemporary documents because many of them were migrants who subsisted by squatting on their ancestral lands, which were now owned by White settlers.

In the late 19th and early 20th centuries, the Potawatomi who evaded forced removal gathered in northern Wisconsin and the Upper Peninsula of Michigan where many worked in the timber industry and formed the Forest County Potawatomi Community.

[8] The community was originally designated as the Wisconsin Territory's "Town Nine," making it the oldest settlement in Washington County.

[9] Beginning in the 1840s, many German immigrants—particularly from the regions of Bavaria, Hessen, Rheinland, Pommern, and Prussia[10][11]—settled in the area, which led to it being named "Germantown".

[13] The town included the then-unincorporated communities of Dheinsville, Goldenthal, Kuhberg (later known as Victory Center), Meeker Hill, Rockfield, South Germantown, and Willow Creek.

In the 19th and early 20th centuries, Germantown's economy relied heavily on agriculture, including dairy farming.

[9][14] South Germantown was a stop on the Chicago, Milwaukee, and St. Paul starting in the late 19th century, and the hamlet grew and prospered because of its rail connects to other communities.

From July 1944 until January 1946, the hamlet of Rockfield in present-day Germantown was the site of Camp Rockfield, an Allied prisoner of war camp that held 500 German prisoners of war, including captured members of the Afrika Korps and many soldiers captured at the Battle of Cherbourg.

The prisoners had originally been held at Fort Sheridan, north of Chicago, but were transferred to camps in rural Wisconsin, such as the one at Rockfield, to work in agriculture.

Other POWs were transported to work sites throughout Ozaukee and Washington counties, including the Pick Manufacturing Company in West Bend and the Fromm Bros., Nieman & Co. Fox Ranch in northern Mequon.

[16] In 1963, Milwaukee annexed a small parcel in the southeastern part of the Town of Germantown to expand a landfill.