The first Europeans to pass through the Gutha area were government Assistant Surveyor Augustus Charles Gregory and Francis Thomas Gregory (both attached to the department of the Surveyor-General) and their brother Henry Churchman Gregory, on a public-private funded expedition to search for new agricultural land beyond the settled areas. They passed 5 km (3 mi) north of Gutha on 8 September 1846, on their way to the Irwin River.[3]
In 1913 it was decided to establish a railway siding there, 26 km (16 mi) north of Morawa on the Wongan Hills to Mullewa railway line. The district surveyor suggested the name "Muthingutha", the Aboriginal name of a nearby rockhole. This was shortened to Gutha by the Lands Department, and Gutha siding was established in 1915.[4] It was gazetted as a townsite in 1914.[5]