The area was settled by German immigrants in the 1850s. They initially bought land at Thomastown with the intention of subdividing a German settlement, but fresh from trying their luck at the Bendigo goldfields, found the fertile land at Harkaway south of King Road (originally Koenig Road, built as a stock route to water the cattle) and settled there instead. They typically built small timber cottages for themselves and practiced small-scale intensive agriculture on family lots, with the families primarily engaged in clearing the land and growing wheat, oats and potatoes, and "also very active in dairying". However, a townsite was never actually declared. Harkaway Post Office opened on 1 January 1865.