Kilmore East was settled by John Green, a neighboring pastoralist on the Kilmore Plains. He was a squatter, and William Rutledge purchased the best area occupied by Green in 1841. Green's head station was built 400 metres SSE of what became the Kilmore East Railway Station.[3]
The Post Office at Kilmore East opened on 1 September 1872 as Gavan Duffy, named after
Sir Charles Gavan Duffy the Premier of Victoria until June of that
year. It was renamed Kilmore East two months later and closed in 1976. Gavan Street and Duffy
Street are reminders of the original township name.[5]
In 1976, a bluestone quarry was developed 3 km to the north of the station.[4]
A hilltop above Saunders Road was identified as the starting point of a major bushfire on 7 February 2009 that devastated many localities to the south-east including Wandong and Kinglake.[6] An investigation put some of the blame on a recloser that tried to restore power to a "dangling" power line.[7]