Mt. Angel was originally settled in 1850 by Benjamin Cleaver, who later planned a townsite which he named Roy. In 1881, a railroad station was established and named Fillmore after a railroad official. The following year, a post office with the name of Roy was established, but neither name was to last.
Rev. Fr. Adelheim Odermatt came to Oregon in 1881 with a contingent of Benedictine monks from Engelberg, Switzerland, in order to establish a new American daughter house. After visiting several locations, he found Lone Butte to be the ideal location for a new abbey, and shortly afterwards ministered to several local Roman Catholic parishes, about the same time large numbers of immigrants from Bavaria settled in the area. Due to his efforts, the city, post office and the nearby elevation Lone Butte came to be known as Mount Angel (an English translation of Engelberg) in 1883. He also established Mount Angel Abbey, a Benedictine monastery and school, which was moved permanently to Mt. Angel in 1884.
Mount Angel Abbey is still located on Lone Butte. The original Kalapuyan name of the butte is Tapalamaho, which translates to "Mount of Communion." At the request of the Archbishop of Oregon City, the abbey opened Mount Angel Seminary in 1889 for the training of priests. The original wooden buildings at the foot of the butte were destroyed in a fire in the 1890s, and another disastrous fire in 1926 consumed the second monastery, an imposing five-story edifice of black basalt at the top of the butte. The current monastery building was completed in 1928, and subsequent structures followed, including a library built by Finnish architect Alvar Aalto in 1970. A bell tower was added to the abbey church in 2007 which contains eight bells, one of which is the largest swinging bell in the Pacific Northwest.
There were 1,059 households out of which 35.5% had children under the age of 18 living with them, 48.0% were married couples living together, 10.8% had a female householder with no husband present, and 37.5% were non-families. 33.1% of all households were made up of individuals and 20.5% had someone living alone who was 65 years of age or older. The average household size was 2.75 and the average family size was 3.54.
In the city the population was spread out with 30.2% under the age of 18, 8.5% from 18 to 24, 25.1% from 25 to 44, 17.9% from 45 to 64, and 18.2% who were 65 years of age or older. The median age was 34 years. For every 100 females there were 92.5 males. For every 100 females age 18 and over, there were 85.3 males.
The median income for a household in the city was $36,293, and the median income for a family was $45,650. Males had a median income of $33,523 versus $21,442 for females. The per capita income for the city was $15,535. About 10.3% of families and 16.3% of the population were below the poverty line, including 16.6% of those under age 18 and 20.2% of those age 65 or over.
In March 2006, the city announced plans to build a 49 foot (15 m) glockenspiel. Completed in time for Oktoberfest 2006, the glockenspiel is the largest in the United States. Located on the corner of Charles and Garfield streets, the four-story-tall glockenspiel is part of the new Edelweiss Village Building. The glockenspiel was manually run several times during Oktoberfest and the following month until the fully computerized system was in place. As of December 2006, the glockenspiel is running daily at 11 a.m., 1 p.m., 4 p.m. and 7 p.m.