Dresden was founded by two Geneva speculators Harman Bogert and Samuel Colt, who purchased 800 acres in 1811.They retained surveyor Valentine Brother who laid out a rectangular street plan. Named for Dresden, Germany, Dresden was the only planned community in Yates County. One of its three public squares is still visible: the open area on all four points of the corner of Main and Cornelia Streets.

Dresden's founders vied to have their town declared the county seat but Penn Yan seized the honor in 1823.

Dresden was a center for agricultural trade, milling and boatbuilding. In 1855 it had a population of 365 people.The railroad came in 1876. By 1900 Dresden had become a railroad town with a resident crew grain elevators and warehouses clustered near the depot. Brakemen engineers, section hands and other rail workers lived in the village.