In October of 1754, explorer Anthony Henday, the first European to visit the Blackfoot natives on the western prairies, camped near the present site of Innisfail. Another early visitor to the area was Reverend John McDougall who developed a trail from Fort Edmonton to his mission church at Morley. This path in the 1870s wound through what is now the Innisfail district.
This old aboriginal trail was called "Wolf's Track" and the area was known as Poplar Grove. Many people considered it a popular location for homesteading and many families chose the area for settlement. In the 1880s, stopping houses began to appear on the trail.
The name of Innisfail comes from an island in Loch ("lake" in English) Awe, Argylshire County, Scotland. In the Celtic language, "Isle of Destiny" was pronounced "Innisfail." In fact, the original name of Ireland was Innisfail. Over the years there have been many versions of this particular name including Innisvville, Innisfree and Innishail. On November 20, 1903 Innisfail officially became a town.