Oral tradition suggests that the village was founded in the 1st century[3] during the Visigothic settlement of the region,[3][4] a time when the nearby Roman road (Via Nova XVIII) was extended.

[5][7] A German traveller who visited Vilarinho da Furna in the final years of the 18th century noted that the houses were comparable to those of other peasants in the region.

His large host family lived comfortably; in contrast to many other places, they had no shortage of food and their beds were clean and made-up with white linens.

[3] When including all structures, the compensation was equivalent to 5 escudos 1 square metre (11 sq ft), which was less than the cost that HICA incurred to build houses for its workers.

[9] In 1981, the municipality of Terras de Bouro built an Ethnographic museum in São João do Campo that commemorates the history of Vilarinho da Furna.

Some of its goals, such as the reforestation of the old lands, the creation of animal reserve, the development of an underwater museum and tourist activities, have been realized by the organization.

Vilarinho da Furna was situated in the southern slopes of Serra Amarela, providing the village with both good solar exposure and protection from the northerly winds from the higher mountains.

Pasturelands on hilltop, at most 1,300 metres (4,300 ft) above sea level, are predominantly sparse, with poor soils and exposed outcrops.

In order to avoid occupying arable land, the houses in the village were constructed side-by-side, thereby defining inter-community streets, alleys and the common spaces (including the alpendoradas, in which the Junta gathered).

The construction of the dam made scientists take notice of the village and its communitarian social system, which was uncommon in the 20th century, but which in remote times was found throughout Europe.

[3] The Junta's leader (Zelador, or Juíz) was chosen from among the married men, and sat for a term of six months together with its legislative chamber (Os Seis).

In the last years of the village's existence, the Junta also devoted itself to devising strategies to fight its final enemy, the company that constructed the dam.

At the end of World War II, the count was almost 1000 head higher, as a result of the high price of domestically produced meat.

The mountains around the village, especially Serra da Amarela, have a number of small huts (casarotas) as temporary lodging for the herders.