Unadilla is located on the Susquehanna River near the junction of Delaware, Otsego and Chenango Counties. The name “Unadilla” is derived from an Indian word that means “Place of Meeting” and refers to the original site of the village at the juncture of the Unadilla and Susquehanna Rivers. The Village of Unadilla is located in the Town of Unadilla, which is the most southwesterly municipality in Otsego County. It is about 50 miles northeast of Binghamton, and 20 miles southwest of Oneonta. Cooperstown, the county seat, is less than an hour to the northeast by local roads, and the state capital of Albany is about ninety minutes away on interstate 88-E.

In 1791, Otsego County was formed from Montgomery County. It consisted of the Towns of Cherry Valley and Otsego. The following year, the Town of Otsego was divided and the southern half became the Town of Unadilla. The original town encompassed a much larger area than the present town. In 1801 the New York State Legislature divided Otsego County into the present towns so the Town of Unadilla, including the village, celebrated its bicentennial year in 2001. The village was separately incorporated in 1828 and again in 1889.