For centuries preceding Anglo-European settlement, Columbia Basin Indians lived, fished, hunted and traded along the three rivers which border Sherman County.  Early explorers reported the splendid abundance of the Pacific Northwest and by 1843 thousands of pioneers set out for the Oregon Country. Emigrants passed through what is now Sherman County in a great cloud of dust on the way to the Willamette Valley.  As the pioneers felt crowded in the new settlements of western Oregon, they turned east to the Columbia Plateau for new opportunities.

The county's first white settler was William Graham, who located at the mouth of the Deschutes River in 1858.  Innkeepers and operators of ferries,  toll bridges and stage stations came first. Stockmen followed with herds of horses, cattle and sheep which ranged freely over the rolling bunch grass hills.

Homesteaders, eager for land, arrived in the 1880s by steamboat, stagecoach and wagon. Soon farmers were settled on nearly every quarter section, 
plowing the grass and fencing their fields in order to receive government patents.

As the population grew, so did the sentiment for independence from Wasco County.  In 1889, E.O. McCoy's legislative bill created a new county to be called Fulton after the pioneer Fulton family. However, the name given was Sherman after General William Tecumseh Sherman of Civil War fame.

Beginning in the 1840s, emigrants on the Oregon Trail crossed through the northern part of the county from the John Day River Crossing to the mouth of the Deschutes River.  Some emigrants destined for the Barlow Road, took a cut-off near the John Day leading southwesterly through Grass Valley Canyon to a crossing near Buck Hollow on the Deschutes. 

From the 1860s, a series of stage, mail and freight routes crossed the county, connecting The Dalles with Boise, Walla Walla and Canyon City. The Dalles Military Road, established in 1868, cut diagonally through the county from the northwest on the Deschutes toward Shaniko in Wasco County on the south, following a route used for years by pack train operators.

Oregon Railway and Navigation Company trains steamed down the Columbia from the John Day River to Celilo in 1881.  The railroad connected with the transcontinental line in 1883, bringing many settlers to the area.