The Crown acquired the Wairarapa Lakes from Ngati Kahungunu in 1896, and for this they were later given land that is now present-day Mangakino in 1915. At that time it was native bush, pumice, barren, unoccupied and unfarmed.
After the Karapiro Dam was finished, workers moved on to the next dam construction site, which was near Mangakino. The Crown, under the Public Works Act, reacquired an area at Mangakino to build a hydroelectric station and temporary township to house the construction workers. It was only meant to be a temporary town under the planned dams were completed. Work on the damns continued through to the 1960s, with villages at Whakamaru, Waipapa, Maraetai and Atiamuri also popping up to house the associated workforce. Waipapa and Maraetai have since been disbanded.