Bozhentsi was established after the incursion of Ottoman Turks in Veliko Tarnovo, the former capital of the Second Bulgarian Empire, in the 16th century. Many residents of the capital then fled to settle in remote and secure parts of the mountains.
According to the legend, among them was the young female noble (bolyarka) Bozhana; she chose to hide in the area where the village is today and became its namesake. The noble's sons engaged in trade and the village gradually grew to become an important trade junction during the National Revival towards the middle of the 18th century.