The area where the town of Halsey is now located was settled as early as the mid 1840's. It became part of the Burlington Precinct that was organized in 1850. In 1857, the town of Peoria was organized and the district was renamed the Peoria Precinct. Halsey was removed from this precinct in 1872. The first map of the blocks and streets of Halsey, and depot grounds of the Oregon and California Railroad was filed in Multnomah County, Oregon on May 18, 1871 by William L. Halsey, Vice-President, Willamette Valley Railway Company. This company built the railroad through the Willamette Valley in 1870 and 1871. It was completed to Harrisburg in June 1871.

The first four additions to Halsey were filed in Linn County, Oregon, on June 6, 1871, by E. Hayes; on April 19, 1876, Seth W. and Seth S. Hayes filed the second addition. The D.M. Cooper addition was filed on January 13, 1877, and the southern addition was filed on. Or before, June 29, 1882. This completed the general shape of the City of Halsey that we know today.

By 1878 about 400,000 bushels of wheat were being shipped yearly from Halsey. There was also a Planning Mill, a Grange Warehouse, and a Store. In 1880 the town had 306 residents. In 1900, it had 294. The next 20 years was apparently a time of growth and by 1920 the population had grown to 573. It remained fairly constant in the years after that. In more recent years, rye grass has become the leading farm crop shipped from the warehouse in and around Halsey. This area leads the world in the production of this agricultural seed product and it is shipped throughout the United States and to many foreign countries.