Modern Ermelo was founded by Dutch Reformed Church Reverend Frans Lion Cachet (1835–1899), who ministered to farms in the surrounding area. He established a congregation in 1870, which was formally recognised at the church’s fifth annual general meeting in April 1872.
The town was laid out on the farm Nooitgedacht, purchased from PJ Fourie in 1879, and officially proclaimed on February 12, 1880. It was initially managed by the church until 1895, when the government of the South African Republic assumed control.
Cachet named the town after Ermelo in the Netherlands.
In 1901, the town was almost completely destroyed by British forces during the Second Boer War, with only one house left standing. It was rebuilt in 1903.
