Waterford's site has always been strategic. For Native Americans it was the end of a portage from Lake Erie to Le Boeuf Creek. To the French, who shipped and traveled by river, it was an important link between their domains in Canada and Louisiana. The French called present-day French Creek the Venango River, and considered it the beginning of the Ohio River since the creek feeds into the Allegheny, which merges with the Monongahela River at Pittsburgh to form the Ohio. The French government, fearing the influx of British traders, built Fort Le Boeuf at Waterford in 1753. Lake Le Boeuf supplied water for the encampment and provided a place to float the boats being built there. This was George Washington's destination in 1753 when, as a British officer, he delivered an ultimatum from the governor of Virginia demanding that the French commander vacate the area. Washington also inspected the extent of French settlement in western Pennsylvania on this mission. After Fort Duquesne fell in Pittsburgh, the French retreated to Waterford, but within a year they abandoned and burned this fort (1759). A year later the English built a fort here, but that was burned during Pontiac's Rebellion in 1763.
Fear of Native American attacks kept European settlement to a minimum until the 1790s, when Andrew Ellicott surveyed the region and laid out the borough in 1794, a year before Erie was settled. As part of the state reservation program, the commonwealth sold plots to people who promised to establish residence within two years. Scots-Irish settlers from the Susquehanna River valley took up the challenge, building houses of red brick and indigenous stone. Before 1812, a peak of one hundred wagons a day filled with salt shipped into Erie from New York and trekked down the Erie and Waterford Pike; it took two days to cover the fourteen miles from Erie to Waterford. After 1812, the salt trade ceased, but the village continued to serve as a rural commercial center. Lake Le Boeuf provided a harbor for flatboats and other waterborne vehicles heading south.
In the 1850s, a plank road served the borough, replaced by freight rail service in 1859 and passenger service five years later. None of the rail lines came directly through the oldest part of Waterford, which enabled the architecturally significant nineteenth-century buildings in the commercial district to remain intact. Frame Greek Revival houses from the 1840s survive in the 100 block of 2nd Street. Waterford Academy (1822), which had a magnificent doorway and cupola, was demolished in 1956. Waterford Covered Bridge, constructed with a Town truss system in 1875, spans Le Boeuf Creek east of the village.
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