The municipality is named for Canada's first Prime Minister, Sir John A. Macdonald. The Rural Municipality of Macdonald was formally incorporated in 1881, making it one of the oldest municipalities in Manitoba.

 

Many native tribes such as the Cree, Ojibway, Assiniboine and Saulteaux, originally inhabited the area. These tribes formed a unified alliance against the feared Sioux tribes. The Metis people were some of the early settlers "staking claims" in the region. By 1882, the Canadian Pacific Railway began to lay tracks through the Village of LaSalle, and better roads were graded between Sanford and Winnipeg. These improvements quickly helped settlers to permanently settle in the municipality.

Macdonald is a rich cultural mosaic of nationalities. Residents of Macdonald include people of Metis, American, Slavic, German, English, and many other descents.