Badger Creek was surveyed as a village settlement in 1894, providing blocks of 8 ha. The name possibly arose from the early settlers confusing wombats with English badgers. Another account is that a horse named Badger, owned by one of the pioneering Ryrie brothers, became bogged in the creek.
The earliest settlement in the area was the Coranderrk Aboriginal Station which was occupied in March, 1863, the year before Healesville township was surveyed. The Station, of 1,963 ha., had a population of 64 Aborigines, a peak figure of 148 in 1878 and 42 in 1922, the year before it was closed. The Coranderrk primary school was opened in 1890, and was replaced by the Badger Creek school in 1899, teaching both Aboriginal and white children.
In 1909 a weir was constructed on the Badger Creek to add to Melbourne’s water supply. The weir now feeds the Coranderrk aqueduct which joins the O’Shannassy aqueduct which runs to the Silvan Reservoir. The weir is in the Badger Creek reserve.
In the 1920s Badger Creek had a school, a post office, a church, boarding houses and a saw mill. After the Black Friday bushfires on 8 January, 1939, the residents of Badger Creek met in the Progress Hall and formed the Fire Brigade.
The township has numerous residential allotments, a corner shopping centre, caravan holiday park, a school and halls. Badger Creek’s census populations have been 91 (1933) and 159 (1954).