In addition to their industrial history, the Yantic Falls figure in the area's Native American history, as the supposed site of the last major battle between members of the Mohegan and Narragansett peoples during the Pequot War in the 1640s. The first known industrial use of the water power provided by the falls was a nail factory established in 1813. This was rapidly followed by other businesses, including a paper mill and a textile mill. Many of these early businesses failed during financial panics in the 1830s, and the water rights around the falls were consolidated into a single business, the Yantic Falls Company, in the 1860s.
