In 1819 Alpheus Williams and Archibald Phillips settled where the Clinton River crossed the old Saginaw Trail, built a dam and a sawmill, and started what became Waterford Village. The trail is now Dixie Highway. The township was organized in 1834 and took its name from its water, which still covers much of the map with dozens of named lakes, Cass Lake among them. The railroad arrived in 1851 with depots at Drayton Plains, Waterford and Windiate, and the line turned the area into a summer resort.

Aviation gives the township an unusual commercial anchor. Oakland County International Airport began in 1928, when the City of Pontiac bought 160 acres for a field. The county took it over in 1967 and gave it its present name in 1996. Airport businesses together rank among the township's larger taxpayers.

County government is the other anchor. The West Campus of the Oakland County Service Center is here, including the County Executive Building, and Oakland Community College's Highland Lakes campus sits on Cooley Lake Road. Retail and service property follows M-59, Dixie Highway and Telegraph Road, with Drayton Plains on Dixie among the older settlements. Pontiac is a separate city on the township's eastern side.