In 1791, Otsego County was formed from Montgomery County. It consisted of the Towns of Cherry Valley and Otsego. The following year, the Town of Otsego was divided and the southern half became the Town of Unadilla. The original town encompassed a much larger area than the present town. In 1801 the New York State Legislature divided Otsego County into the present towns so the Town of Unadilla, including the village, celebrated its bicentennial year in 2001. The village was separately incorporated in 1828 and again in 1889.