The land was purchased from the Oneida people in 1785. The town was first settled around 1787. One of the first settlements was in what is now known as East Guilford, by the Mercereau brothers (who were Revolutionary War spies for George Washington). They built a mill on Guilford Creek at Indian Orchard Falls, along the Catskill Turnpike.
Guilford was formed from the town of Oxford in 1813 as "Eastern". The name became "Guilford" in 1817. The town was called by an older name, "Fayette", for the early part of its history during the time it was in Tioga County.