A prospector from the Big River area to the east, Terence “Red” Gaffney, was the first to actively search the area for gold, followed by two others who discovered alluvial gold at Raspberry Creek in 1859.
A string of small villages later appeared in the valley, and these were subsequently amalgamated and collectively named Lauraville by the Government Surveyor in honour of his wife, Laura. The Post Office (called Gaffneys Creek) opened on January 1, 1862 (closed in 1981).
The name "Lauraville" was changed to Gaffneys Creek in 1900.
Alluvial mining was later replaced by reef mining, but none of these mines were to achieve the success of the nearby A1 Mine Settlement and by the turn of the century the population had dwindled.
In 1980 the area of the original valley settlements was placed on the Register of the National Estate as a Conservation Area including early miners' cottages, a hall, stone retaining walls and a hotel which succumbed to a fire in 1993.
The population within the locality has steadily declined over the years: