In 1843, Michigan's Upper Peninsula was divided into Mackinac, Chippewa, Marquette, Schoolcraft, Delta, and Ontonagon Counties. In 1845, a portion of Ontonagon County was partitioned to be part of Houghton County. In 1846, the village of Ontonagon was named as the county seat of Ontonagon County.
Ontonagon County is part of Copper Country, a region of the Upper Peninsula with prevalent copper mining from 1845 until the late 1960s. Prehistoric mining was conducted by local Native American populations. The first attempts by Europeans to mine copper in the area came in 1771 in the Ontonagon River. The Ontonagan Copper Boulder was removed from the west branch of the Ontonagon River and transported in 1842 to Detroit where it was weighed at 3708 pounds, thence to the Smithsonian Institution. The last copper mine in Copper Country was the White Pine mine, which closed in 1995.
The county is named after the Ontonagon River. The name is said to be loosely derived from an Ojibwe language word noojitoon ziibi, meaning "hunting river." A French transliteration, Nantounagon, identified the river on a 1670 French map. Alternatively, and perhaps more accurately, it is said to be derived from the Ojibwa onagon, which means "dish" or "bowl." See List of Michigan county name etymologies.