The Elizabeth Islands, including Cuttyhunk, were discovered in 1602 by Bartholomew Gosnold. He and his crew attempted to establish a trading post on Cuttyhunk so they could trade with the natives; the first attempt by Europeans to do so, the trading post was abandoned after only a few weeks, and Gosnold decided to return home. Upon his return to England, the island chain came under the jurisdiction of the British Crown.
Gosnold was first settled in 1641, the year of purchase of the islands by Thomas Mayhew, Sr. The islands were claimed by the Wampanoag until 1658, when the Wampanoag sachem transferred the deed of ownership to Mayhew. Constituting Dukes County, New York since 1683, the Elizabeth Islands, Martha's Vineyard, and Nantucket, were transferred to the newly created Province of Massachusetts Bay in 1691. Gosnold was officially incorporated in 1864, having formerly belonged to the town of Chilmark.
There were 46 households out of which 17.4% had children under the age of 18 living with them, 34.8% were married couples living together, 8.7% had a female householder with no husband present, and 54.3% were non-families. 45.7% of all households were made up of individuals and 6.5% had someone living alone who was 65 years of age or older. The average household size was 1.87 and the average family size was 2.71.
In the town the population was spread out with 17.4% under the age of 18, 5.8% from 18 to 24, 32.6% from 25 to 44, 31.4% from 45 to 64, and 12.8% who were 65 years of age or older. The median age was 42 years. For every 100 females there were 138.9 males. For every 100 females age 18 and over, there were 144.8 males.
The median income for a household in the town was $22,344, and the median income for a family was $27,500. Males had a median income of $21,875 versus $30,625 for females. The per capita income for the town was $15,265. There were 25.0% of families and 23.5% of the population living below the poverty line, including 40.0% of under eighteens and 22.2% of those over 64.
Despite its being the least populated community in the Commonwealth, Gosnold is not the least densely populated, with that title belonging to Mount Washington, at the southwestern corner of western Massachusetts.
On the national level, Gosnold is a part of Massachusetts's 10th congressional district, and is currently represented by Bill Delahunt.
On the state level, Gosnold is represented in the Massachusetts House of Representatives as a part of the Barnstable, Dukes and Nantucket district, which includes all of Martha's Vineyard and Nantucket, as well as a portion of Falmouth. The town is represented in the Massachusetts Senate as a portion of the Cape and Islands district, which includes all of Martha's Vineyard, Nantucket and most of Barnstable County (with the exception of Bourne, Sandwich, Falmouth and a portion of Barnstable.. All of Dukes County is patrolled by the Fifth (Oak Bluffs) Barracks of Troop D of the Massachusetts State Police.
Gosnold is governed on the local level by the open town meeting form of government, and is led by a board of selectmen.