Montesano was settled in 1852 at the confluence of the Chehalis, Satsop, and Wynoochee rivers. Log-toting steamboats churned through the river passages from 1859 until railroad tracks arrived in 1885. When the town was incorporated in 1870, its population had reached about 1,500. The Vidette, which published its first issue in 1883, is still going strong, chronicling the times since Montesano became the Grays Harbor county seat in 1886. The town has a historic district with several buildings dating from the late 19th and early 20th centuries.
In 1900 Frederick Weyerhaeuser and 15 partners began the Weyerhaeuser timber company with 900,000 acres of Washington forestland. Forty years later the company purchased 200,000 acres near Montesano and established the Clemons Tree Farm, the world's first. Today the Weyerhaeuser Company ships paper and lumber worldwide, and is one of Washington's most profitable firms, and Montesano dubs itself the "Home of the Tree Farm."