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The village of Milford began with the building of a sawmill by Elizur and Stanley Ruggles in 1832. Early county records indicate that the mill was erected in the "Township" at that time, and that formal organization would occur in 1834. That same year, the first gristmill was erected by Luman Fuller. In 1835, the first post office was established with Aaron Phelps as postmaster.
The Lower Mill Pond was created in 1836 to provide waterpower for the various types of mills and factories. The Upper Mill Pond followed in 1845. In 1911, the Hubbell Pond was created by a dam built on the Huron River to generate electricity. The village was incorporated in 1869.
Hydropower made it possible for Milford to become one of the first communities to have electric lights, in 1892. A year later, telephone service was available in the Village. As a point of reference, nearby South Lyon did not have electric lights until 1932.
By 1939, Henry Ford built a carburetor plant and two hydroelectric stations intended to allow residents to maintain their agricultural work while working in the factories. The former carburetor plant was demolished in 2002. The Art Deco station still remains on Pettibone Creek in the village, and restoration work began in 2004.