The area that is now Waterville was once the territory of the Canibas tribe of the Abenaki Indians. Named Taconnet, after Chief Taconnet, the main village was on the eastern bank of the Kennebec River at its confluence with the Sebasticook River. Although some English traders were in the region between 1650 and 1675, the first recorded permanent settlers arrived in the 1760s. The English knew the village as Ticonic Village.
The village was burned in 1692 during King Williams War, after which the Canibas tribe abandoned the area. Fort Halifax was erected under the direction of General John Winslow in 1754
The township was first organized as Kingfield Plantation, then incorporated as Winslow in 1771. Waterville was set off from Winslow, and incorporated under that name on June 23, 1802; in part because residents on the west side of the Kennebec were unable to cross the river to attend town meetings. A bridge was built in 1824.
Early industries included agriculture, fishing, lumbering, and ship building. As the Ticonic Falls blocked navigation further upriver on the Kennebec, Waterville was the terminus for trade and shipping. The Kennebec River and Messalonskee Stream both provided water power to run mills, including sawmills, gristmills, a sash and blind factory, furniture factory, and a factory that manufactured shovel handles. The railroad came in 1870, after which locomotive and car repair shops were established in Waterville.
Waterville was incorporated as a city on January 12, 1888.