The area was first surveyed in 1836 by John Septimus Roe but the township was not established until the 1890s. As with many towns in Western Australia, the discovery of gold, although farther east at Southern Cross, stimulated Merredin's development. It became a rail centre for the region due to the availability of fresh water. The original holding dam and water tower, constructed when the railway reached Merredin in 1893, can still be seen today.

A notable feature of the town is the Old Railway Station, now a museum, which was built from bricks salvaged from three original Kalgoorlie loop line stations in 1920. The bricks were made of clay which, locals say, contains traces of gold that would be recoverable using today's technology.

The station contains 'G117', the steam engine built in 1897 for the Kalgoorlie Express, and other rail relics from the gold rush days including the original Merredin signal box.

Other attractions in the town include the Merredin Peak Heritage Trail which starts from the railway station. The half­hour walk passes the historic buildings in the town and, for the more adventurous, there is a six­kilometre track around the peak itself.

A popular picnic spot close by is Burracoppin Rock.

• Name origin: From the Aboriginal word meaning 'place of the merritt'. Merritt trees were used by Aborigines to make spears.