Millinocket grew up as a pulp and paper mill town. In fact, the Great Northern Paper Company didn't locate in Millinocket, the town rose up around the mill.
The first white man to take up residence in the area, however, was not a millworker, but a farmer. Thomas Fowler came to the region in 1829, initially settling on the west side of the West Branch of the Penobscot River, below Grand Falls at the head of Shad Pond, bringing with him his grown children, who cleared land nearby. Fowler and his family lived there until the late 1830s, having two more children, Adeline Fowler becoming the first white child to be born in the territory.
Perhaps because access to Grand Falls was difficult, Fowler abandoned his home and moved upstream about two miles, clearing land for a new farm along the banks of Millinocket Stream, in the area that was later to become the mill yards of the Great Northern Paper Company. This was sometime in the late 1830s. In 1882, he sold his farm to Charles Powers, a grandson, who lived there until 1899, when the Great Northern Paper Company purchased the farm.
Great Northern began with Charles Mullen, an engineering graduate of the University of Maine, who had participated in the building of a dam and groundwood pulp mill in Enfield. When the Bangor and Aroostook Railroad had completed a section of its track from Bangor to Houlton, crossing the West Branch near the rapids and falls between Quakish Lake and Shad Pond, Mullen recognized that this area was ideal as a power source for a large pulp and paper mill. Investors were found, and the project moved forward. Construction on the mill began on May 15, 1899, and the first newsprint came off of its machines on November 9, 1900. The whole plant was operational five months later.
Millinocket was incorporated on March 16, 1901 from a portion of Indian Township Number 3, the remainder of which still borders the town on its north and west. By 1903, its population had grown to 3,000; and in a very short time, it had become one of the state's wealthiest towns, heralded in the press as the "Magic City."
After changing ownership several times over a period of twenty years, Great Northern's mills in Millinocket and East Millinocket were closed in December of 2002, the company filing for bankruptcy the following month. Under new ownership, the mills were reopened a couple of years later but with a drastically reduced workforce, and it has recently been announced that the Millinocket mill would close in July of 2008.
Marketing itself as a tourist destination, the town has had little success, its population shrinking to half of what it had once been. With Baxter State Park to its north, Millinocket is the town nearest Mount Katahdin, the northern terminus of the Appalachian Trail.