The hamlet of Centereach was first called West Middle Island, but primarily became known as New Village until the early 20th century. When it was discovered that another town shared the same name in Upstate New York, the name was changed to Centereach in 1916. The name Centereach reflects the centrality of the hamlet's location on Long Island, literally meaning "center reached".
The two earliest suburban developments, which began in the early 1950s, were Dawn Estates and Eastwood Village.
In 1998, the first single-point urban interchange in New York State was opened in Centereach, at Middle Country Road and Nicolls Road. In 2007, the town was commended for having the fastest and most complete snow clearing services, following the major blizzards.
Centereach has a strong sense of community, and thanks to a dedicated group of civic-minded residents Centereach has started a transformation into a cohesive community. The newly formed Smart Growth Coalition was organized to inspire and produce a plan of action to improve the roadways, parks, and building ordinances in Centereach and the neighboring hamlet of Selden.
In 2007, the town was commended for having the fastest and most complete snow clearing service, following the major blizzards. Centereach, historically a working class area, has experienced a construction boom in the past decade. As of 2009, the median home price was $335,000. New construction in the Centereach area has resulted in an influx of residents with a higher median income.