Prior to the gold rush, the Bendigo district was part of a large sheep-station/farming allocation, known asThe Ravenswood Run. However, the discovery of significant gold deposits in the 1850s resulted in a huge influx of people to the region, eager to seek fortune and wealth. The population of Kangaroo Flat decreased as the gold rush ended, despite this, the town has always maintained its own cultural heritage and identity.
In more recent times, Kangaroo Flat has had resurgence along with most of the region, with the population increasing dramatically over the last decade. As its population edges towards the 10,000 mark, a number of the town's facilities have gone through dramatic upgrades in order to keep pace with the community’s needs.