Until January 1, 2007, Farsø was also a municipality (Danish, kommune) in North Jutland County. The municipality covered an area of 201 km², and had a total population of 7,991 (2005). Its last mayor was H. O. A. Kjeldsen, a member of the Venstre (Liberal Party) political party.
Farsø municipality ceased to exist as the result of Kommunalreformen ("The Municipality Reform" of 2007). It was merged with Løgstør, Aalestrup, and Aars municipalities to form the new Vesthimmerland municipality. This created a municipality with an area of 815 km² and a total population of 39,176 (2005).
Farsø was the birthplace of Johannes Vilhelm Jensen, winner of the Nobel Prize in Literature in 1944.