The majority of Paw Paw’s first settlers were farmers. Rodney Hinckley could be seen as the founder of Paw Paw, since it was he who laid claim to a large amount of farmland in 1832 that would later be deemed Paw Paw village. During that same year, Pierce Barber erected a sawmill where the river met the west end of what would soon become Paw Paw village. Barber was the first of many men who aspired to use the Paw Paw River for the transportation of goods. Once the sawmill was erected, Barber soon sold the rest of his interest in the sawmill to Rodney Hinckley. The erection of the sawmill and Barber’s brief interest in the river is important to Paw Paw’s history, since many of the village’s first inhabitants moved there to clear land and work the sawmill.
1833 was a very important year for the newly founded Paw Paw. Besides the erection of the sawmill, many farmers, such as E.L. Barrett, arrived at Paw Paw and began breaking the land. E.L. Barrett was also the first settler that built frame houses in not only Paw Paw, but also the entirety of Van Buren County. Thanks to John Agard, in 1833 Paw Paw also became a trading post, bringing more people and business to the viallge. Agard built the trading post along the Paw Paw River, and mostly traded furs and sugar with the local Native Americans.
From 1834 to 1840, many young men from farming families in Ohio and the East Coast came to Paw Paw to claim their own plots of land. On March 26th, 1835 the farming area, including Paw Paw village, was christened as the town of Lafayette. Two years later, Lafayette was named as the county seat for Van Buren County. By 1845, the first Van Buren County Courthouse began its operations as county seat within Lafayette. In 1867, Lafayette was renamed to Paw Paw, after the river and small paw paw trees that grow on its banks. For the next fifty years, until Mariano Meconi made Paw Paw grape country, the economy of the town was primarily agrarian.