McGrath began as a meeting and trading place for Big River, Nikolai, Telida, and Lake Minchumina villagers across the river from present-day McGrath. In 1904, a trading post was established at the old site by Abraham Appel. Gold was discovered in the Imoko District in 1906 followed by Ganes Creek in 1907. McGrath became a regional supply center since it was the northernmost point on the Kuskokwim River. In 1907, a town was established at the old site of Mcgrath and was named for Peter McGrath, a local U.S. Marshal. From 1911 to 1920, the Iditarod Trail contributed to McGrath’s role as a supply center as many people walked and mushed on their way to the Ophir gold districts. However, after 1925 mining sharply declined. In 1933, the river flooded and residents began to move across the river to where present-day McGrath is located. Changes in the river’s flow eventually left the old site useless for a river stop when it became a slough. During World War II, McGrath served as a refueling stop for Lend-Lease equipment.