Madisonville was established in 1809 as Madison, Ohio after the newly elected President James Madison, the fourth president of the United States. Prior to 1809 settlers had already begun to arrive in the territory.

The first permanent setter was Joseph Ward, a sixty-five year old Revolutionary War veteran from New Jersey. Joseph and his two sons, Usual and Israel, came overland by horseback intending to settle in the new outpost of Columbia. Joseph's wife, Phebia, and other sons and daughters traveled by flatboat down the Ohio River to be reunited at Columbia.

Seeing the obvious flooding at that location they decided to go up higher and settled in what was to become Madisonville. Joseph and his sons built the first house, a log cabin, in 1797 along an old Indian trail near what is now Whetsel and Monning Avenue.

By 1926 a Post Office was established in the village and the name was changed to Madisonville to avoid duplication with another Madison, Ohio.