The modern history of Cherry Valley begins with John Lindesay receiving a land grant from George II of England; he moved there in 1739, and seven Anglo-Scottish families from New Hampshire moved into the area the following year. Due to high snow, the community almost failed but was saved by provisions from local natives.
During the American Revolutionary War, Walter Butler, a New York Loyalist, led a mixed force of Indians and Loyalists to the area, resulting in the Cherry Valley Massacre, during which more than 40 people were killed and many were captured. This massacre was followed by a second raid in 1780, leading to the temporary abandonment of the village.
The town was established in 1791 from Canajoharie (in Montgomery County) as one of the original towns in the county. It was subsequently divided, giving rise to several new towns: Middlefield, Springfield, and Worcester (all in 1797) and Roseboom in 1854.
In 1812, the community of Cherry Valley set itself apart by incorporating as a village.