Originally called Taklamah,"the town's name was changed to Takilma in 1902. Colonel T.W.M. Draper of the Waldo Copper Mining Company was the founder of Takilma, which was named for an Indian chief.

The first post office was established on August 2, 1902, by George F. Morgan. The town was established due to copper mining. The Queen of Bronze Mine was a major mine throughout the 1920's.