The idea for the creation of a historical museum in Orange County was formed when artifacts were displayed in Orange County's Old Courthouse during the 1954 Bicentennial celebrations of the founding of the town of Hillsborough. The project was championed by the Hillsborough Garden Club. Under the leadership of Mrs. Clarence Jones, members of the Garden Club worked tirelessly to find financial support, a location, and volunteers to run the Museum. To create the collection, local families donated domestic goods, military relics, costumes, and furniture from their homes. The Orange County Commissioners approved the use of the second floor of the 1845 Courthouse and appropriated $250 toward the Museum, and in November of 1957 the Museum opened its doors with the Garden Club as its sponsoring organization. In 1983, the Museum moved to its current location.
The Hillsborough Historical Society was founded in 1962 by a group of interested citizens. Among their many activities, they filed applications for buildings to be included in the National Register of Historic Places, gave historic walking tours, and published newsletters and journals
In May 2007, the Orange County Historical Museum merged with the Hillsborough Historical Society to form the Historical Foundation of Hillsborough and Orange County, a 501(c)(3) nonprofit organization. The Hillsborough Garden Club is still extremely involved with the Museum and supportive of its many programs.