The first settlers to come to Dassel Township were C.L. Richardson and Edwin Ayres, who built a cabin in the hills above the north end of Long Lake. They unfortunately were forced to abandon their home when the US-Dakota War of 1862 broke out. The cabin was burnt to ash, and a new settlement was established on the shores of Swan Lake.
Swan Lake Township was organized properly in 1866, and the town of Dassel soon followed in 1869 when the railroad reached that area of Meeker County. The name came from Bernard Dassel, a secretary and paymaster of the St. Paul and Pacific Railroad Company. Responding to the growing community, "Swan Lake Township" became "Dassel Township" that same year.