Once an important forest products center and is now an area of young-growth timber east of Marysville near the Pilchuck River. It was originally called Portage by an early Native American trader.
The city lies between the South Fork of the Stillaguamish River and the Pilchuck River, whose narrow but fertile valleys by the 1940s were being converted to agricultural uses—dairying, poultry raising, berry growing, and truck farming. In the 1940s, two mills in the town manufactured cedar shakes and shingles; and some logs were still obtained from the surrounding forests, although much of the best timber had been cut.
Granite Falls, first settled in 1885, was named when the Everett & Monte Cristo Railroad was built, for the falls about one and one-half miles east of town where the Stillaguamish River cascades over granite ledges and swirls around huge boulders. Deep quiet pools and sandy riffles are excellent fishing spots for trout. For a time the town flourished on the hopes that some of the many copper, silver, and gold prospects would become major mining developments.
Although no longer the leading industries in Granite Falls, agriculture-related commerce still sustains a good portion of the community. Several historic trails and sites are located nearby along the Mountain Loop Highway.