The town and village of Allegany rest on the banks of the scenic Allegheny River in Southwestern, New York. Allegany is about 75 miles south of Buffalo,New York. Many discrepancies arise over the origin of the name Allegany. A Native American tradition holds that the name comes from the name of the old tribe of Native Americans called Allegewi that used to live along the Allegheny River's banks. Another tradition explains that the name Allegany comes from an old Native American word meaning 'lovely' or 'beautiful.' Allegany, one of the largest towns in New York by size, is about six miles from east to west and about twelve miles from north to south. In additions to the Village of Allegany,the Town of Allegany includes several small hamlets,including Rock City, Chipmonk and Knapp's Creek. The land along the Allegany River is hilly, with areas reaching peaks that are 700 to 900 feet above the floors of the valleys.

In 1789 the Holland Land Company bought large tracts of land from Robert Morris of Philadelphia. Part of this parcel of land is now the town of Allegany. During the beginning of the Nineteenth Century, settlers poured across New York from the eastern part of the state and New England to settle along the Allegheny River. The first permanent settlement in Allegany was made by Ebenezer Reed, who moved here from Connecticut in 1820. The Town of Allegany, was created on April 18, 1831, when it broke off the town of Great Valley. The original name of the town was Burton, but the reason behind that title are unclear. That part of the town's history is present today through the Burton Bar and Restaurant where the locals find the best hamburgers in town. Burton was officially named Allegany on March 28, 1851. Allegany has always been a land rich in various types of agriculture. Dairy farming, various fruit farming, and maple syrup were among the many products once prevalent in the area. It is claimed that John Chapman, also known as Johnny Appleseed, started his tree planting expeditions from the Allegany area, by traveling on the river. Allegany owes its growth to many other industries as well. Western New York was once an important center for the oil and lumber industry. The Allegheny River gave the area much needed access for shipping goods to trading posts.