Named for the Lackawaxen River that flows twelve miles through the Township, the European-American settlement in 1798 adopted the Lenape name meaning "swift waters". The first permanent European settlers in the area were Jonathan Conkling and John Barnes, who built in 1770. During the early part of the 19th century, logging was the principal commercial activity in the area. It produced as much as 50 million board feet (120,000 mΒ³) of lumber annually. Workers floated logs downriver along the Delaware to markets in Easton or Trenton. In 1829, the Delaware and Hudson Canal began operating between Honesdale, Pennsylvania and Kingston, New York. In its time, the canal company was the largest private commercial enterprise in the nation. It built 28 locks in Lackawaxen Township alone, raising the elevation of the canal 278 feet (85 m). Some of the old locks are still visible and several lock houses are now privately owned. Roebling's Delaware Aqueduct, built by John A. Roebling, famed engineer of the Brooklyn Bridge, was constructed in 1848 as part of the canal. It is now preserved as a National Civil Engineering Landmark and National Historic Landmark by the National Park Service (NPS). The canal linked New York City with the rich coal deposits of the Carbondale, Wilkes-Barre and Scranton areas, providing fuel for both the city's industrial foundries and heating the expanding number of residences. In 1848, the New York and Erie Railroad was built through the area; although the canal continued to operate for another fifty years, railroads eventually made canals obsolete. At the same time, the railroad brought tourism to the area and new sources of revenue; the rugged countryside of the upper Delaware Valley became a popular destination for urban tourists. Stations were built at Lackawaxen, West Colang and Mast Hope, and elaborate resort hotels soon were developed nearby, which often provided guides for fishing, hiking and riding in the area. Bluestone quarrying became a major enterprise in the area starting in the mid-19th century. It was used extensively in the construction of the region's buildings and sidewalks. From 1905 to 1918, western author Zane Grey lived in Lackawaxen with his wife and growing family. His early stories related his experiences of fishing along the upper Delaware. Listed on the National Register of Historic Places is the Greys' home from 1914 to 1918, now preserved by the NPS as a house museum, part of the Upper Delaware Scenic and Recreational River area. Grey was buried nearby in the local Union Cemetery. Physician Orvan Hess was born here. According to the United States Census Bureau, the township has a total area of 81.2 square miles (210 km2), of which, 78.4 square miles (203 km2) of it is land and 2.8 square miles (7.3 km2) of it (3.45%) is water. A scenic area within the Upper Delaware River National Park, Lackawaxen is located about a two-hour drive from New York City. It is also located about twenty-two miles north-west of Milford, the County Seat of Government of Pike County.
