Jackson was founded in 1848 alongside a spring. The population, spurred on by placer mining, quickly grew. However, unlike many old west towns that collapsed after the easy gold mining had played out, Jackson continued to grow and prosper.
Its location between Sacramento and the mining campto the south, plus the abundance of water and cattle grazing land helped it to become a permanent town.

Although much of it was destroyed by a fire in 1862, many of the buildings in old town today date from just after the fire.