The history of this town goes back many centuries. The medieval church of St Makessog of Auchterarder was named in 1200 amongst the churches granted to the monastery of Inchaffray by Gillebrigde, earl of Strathearn, on the occasion of its refoundation as an Augustinian priory. It was the hunting lodge of Malcolm III in the 11th century and it played host to Edward I in 1296 during his invasion of Scotland. In 1328, Robert the Bruce gave the town to the Montifex family who later passed it on to the Drummonds as part of a dowry.
Disaster struck in 1715, when the settlement was destroyed by the defeated Jacobite soldiers retreating from the Battle of Sheriffmuir. The battle took place on 13th November 1715 between the Jacobite army of James II (VII of Scotland) and the Hanoverian army of George I. The Jacobites had between 8000 - 1200 men while the Hanoverian was only a third of this around 3500.
The town became an important element of the growing handloom industry. The new town became a thriving textile town. The village has a long history dating back to the 13th Century when it was founded by Gilbert, Earl of Strathearn. Its
ruined castle is said to have been a royal hunting lodge established by Malcolm Canmore in the 11th century and the village itself was for a time a burgh. In 1834 the parish was the scene of one of the first disputes that gave rise to the Disruption of 1843 when the church congregation refused to accept the minister nominated by the land owner.
It was popular with kings and generals, who were partial to the many grand houses around the town.