Like all creeks in Lycoming County, Larrys Creek served as an area for settlers to establish homesteads and farms. As logging became a major industry in the mid-19th century, the creek was a source of power for sawmills and other mills. The first sawmill on the creek, in what is now Mifflin Township, was built in 1799. The relatively low flow of water in the creek did not allow rafts of logs to be floated downstream to the river and the lumber boom at Williamsport (as they were on Pine Creek to the west).