The name 'Erattupetta' is derived from three Malayalam words: 'Era' (two), 'Aaru' (river), and 'Petta' (market or town), signifying the town's origins at the confluence of the Meenachil River and its tributaries. For centuries, the town functioned as a critical trading post. Indigenous farmers and early settlers from the dense, mountainous high ranges of the Western Ghats would travel down to Erattupetta to trade forest produce, spices, and later, cash crops like rubber.
The region has a rich tapestry of faith-based history. Aruvithura, a prominent neighborhood within the town, is home to the St. George Forane Church, believed to be one of the oldest churches in Kerala with roots tracing back to the early centuries of Christianity in India. Additionally, the town has a strong Muslim heritage tied to the legendary Vavar, a companion of the Hindu deity Lord Ayyappa, cementing a legacy of deep interfaith harmony.
Economically, Erattupetta evolved rapidly in the 20th century with the boom of rubber plantations. The town transitioned from an agrarian market village into a wealthy commercial center, a growth heavily supplemented in the late 20th and early 21st centuries by the Gulf boom, as many locals migrated to the Middle East. Recognizing its growth in population, infrastructure, and revenue, the Government of Kerala upgraded Erattupetta from a Grama Panchayat to a Municipality in 2015.