Dr. Van Aerman, who was commissioner of pensions in Washington, D.C., saw some of the government surveyors’ reports of the timber for this territory. Apparently, he also saw the opportunity for business, because together with Olcot P. Boardman and George L. Cornwell, a lumber company was organized. Since New York was the home state of Dr. Van Aerman, he used that to identify his sawmills.

Later, New York Mills also became the name of the community.

Many workers were brought to the lumber mills to work. The New York Mills Company placed advertisements in many papers in other states for mill hands and timber cutters. In 1871, when the Northern Pacific Railroad was built through Otter Tail County, the first shipment to arrive was supplies for the sawmill. The trees found in this area were white oak, red oak, tamarack, spruce, balsam and white pine (some as large as four feet in diameter).

The first buildings began in 1876 with the construction of a boarding house. By the time New York Mills was incorporated, in 1884, the town numbered 300 and had a general store and a cafe as well as four sawmills.

The first settlers were single men who worked in the forests and the mills, but by 1881 there were 64 Finnish farmers living in the area.

By 1916, New York Mills had a population of 500 and dozens of ‘modern’ buildings, both business and residential.