In 1849 the recently organized Minnesota Territory legislature authorized the creation of nine large counties across the territory. In 1853, one of those original counties, Dakota, had a large partitioned off to create Blue Earth County. In 1855 the western part of Blue Earth was partitioned to create Brown County. Then on February 25, 1860, the south part of Brown was partitioned to create this county, with Madelia as the designated county seat. The county was named for its eponymous river, whose name reflects the Dakota word "watanwan," meaning "fish bait," or "plenty of fish." The word first appears in the written record on an 1843 map of the area so naming the river. In 1869 the first settlers arrived in the area of the future Saint James, and the area began growing. In 1870 an extension of the St. Paul and Sioux City Railway was terminated at the village, and railway officials decided to name the terminus Saint Paul. By 1878 the town had grown to the extent that a vote was taken to move the county seat there.
Geography
The terrain of Watonwan County consists of low rolling hills, carved by drainages and dotted with lakes and ponds. The area is completely devoted to agriculture where possible. The terrain slopes to the north and east, with its highest point near its southwest corner, at 1,293' ASL. The county has a total area of, of which is land and is water. The county is drained by the Watonwan River and its tributaries; the river flows eastwardly through the northern part of the county.
As of the 2000 United States Census, there were 11,876 people, 4,627 households, and 3,141 families in the county. The population density was 27.3/sqmi. There were 5,036 housing units at an average density of 11.6/sqmi. The racial makeup of the county was 88.54% White, 0.37% Black or African American, 0.21% Native American, 0.87% Asian, 0.02% Pacific Islander, 8.78% from other races, and 1.21% from two or more races. 15.19% of the population were Hispanic or Latino of any race. 40.9% were of German, 17.3% Norwegian and 5.8% Swedish ancestry. There were 4,627 households out of which 32.50% had children under the age of 18 living with them, 56.60% were married couples living together, 7.30% had a female householder with no husband present, and 32.10% were non-families. 28.70% of all households were made up of individuals and 15.40% had someone living alone who was 65 years of age or older. The average household size was 2.53 and the average family size was 3.10. The county population contained 27.60% under the age of 18, 7.80% from 18 to 24, 24.30% from 25 to 44, 21.70% from 45 to 64, and 18.60% who were 65 years of age or older. The median age was 39 years. For every 100 females there were 95.40 males. For every 100 females age 18 and over, there were 94.50 males. The median income for a household in the county was $35,441, and the median income for a family was $42,321. Males had a median income of $29,242 versus $19,788 for females. The per capita income for the county was $16,413. About 7.80% of families and 9.80% of the population were below the poverty line, including 13.50% of those under age 18 and 8.80% of those age 65 or over.