the town was first recorded in 1010. in 1270 it received the right to hold a market from louis ii, duke of bavaria as recorded in an urbarium. it was a commercial center due to its location on the vils and lauterach rivers, as well as the site of one of the largest hammer works in that era. the city was a local seat of government and belonged to the munich line of the house of wittelsbach. in 1505, schmidmühlen was incorporated along with other properties of bavarian nordgau in the newly created duchy of pfalz-neuburg.