Peninsula was founded in 1837 by Hermon Bronson. The village was named after the peninsula shaped tract of land that was created by the Cuyahoga River. Peninsula was a bustling village during the canal days.

An aqueduct carried the Ohio & Erie Canal over the Cuyahoga River at this location. The canal boats would enter into this lock before passing through the aqueduct, heading south.

In 1832, a gristmill was built near the aqueduct and canal lock. A dam was constructed across the Cuyahoga River to help channel the water towards the mill, where it was used to turn a waterwheel. The canal provided an easy mode of transportation for the goods, which helped the mill prosper. Charles Thomas and Chandler Moody purchased the mill in 1885. In 1902, they torn down the old mill and built a much larger mill. They called it the Peninsula Mills, a.k.a. the Moody & Thomas Mill. Unfortunately, the mill burned down on December 26, 1931.