In the 1920s, the portion of NY 38 between Owego and Freeville was designated as New York State Route 42 while the segment from Freeville to Moravia was the southern part of New York State Route 26, a highway that continued north from Moravia to Syracuse. NY 38 was assigned as part of the 1930 renumbering of state highways in New York, utilizing all of pre-1930 NY 42, the Freeville–Moravia portion of NY 26, and a previously unnumbered highway north to Sterling. Originally, NY 38 extended south into the village of Owego by way of an overlap with NY 96. It was truncated to its current southern terminus by 1994.