The first use of the name "Fort Nelson" was by the North West Company in 1811 when they extended the fur trade upstream from the Liard River. The original post only lasted until 1813 when the clerk in charge, his family and several voyageurs where killed by local natives who were starving and had been denied ammunition. The post was not reopened until the 1850's when the Hudson Bay Company (after amalgamation with the North West Co.) built a new establishment about fifty miles upstream on the East Branch (of the Liard R.), now the Fort Nelson River and the name of Fort Nelson was again used..
Nothing much changed until World War II and the building of the Alaska Highway. The community gradually moved over the next twenty years from the river to along the highway. In the 1950's and 60's natural gas was discovered in volume and along with lumbering the community began to grow. Presently there is between 5 and 6 thousand people in the town and surrounding area. The local economy is based on the petroleum, forestry, and tourism industries.