Oxenhope's name derives from the Old English hop which means valley head, so Oxenhope literally means Oxen Valley Head. The industrialisation of the village came about through the cloth and wool trade and by 1850, Oxenhope was host to over 20 mills. Leeming Reservoir was constructed between 1872 and 1873 to supply the many mills in the area. Its construction necessitated the closure and demolition of at least two mills and their associated houses. The modern village of Oxenhope encompasses what were originally the separate settlements of Uppertown, Lowertown, Leeming and Hawking Stone.

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