Towns County, the 117th county formed in Georgia, was created in 1856 from parts of Union and Rabun counties. It was named for George Washington Bonaparte Towns, who was governor of Georgia from 1847 to 1851.

Young Harris was originally named Young Harris College in honor of Judge Young Loftin Gerdine Harris of Athens. It was soon shortened to Young Harris, although there is still a Young Harris College located there.

Hiawassee is a Cherokee word meaning "meadow."

Chatuge Lake is located in the northern part of the county and reaches into North Carolina. It is a storage facility for the Tennessee Valley Authority, and is also a public preserve.