Savukoski area has had Sámi habitation from prehistoric times to the 1700s. Stone Age as well as Iron Age habitation sites have been discovered in the area of the municipality. The oldest iron weapons found in Finland, daggers dating from approximately 300 B.C., brought here from the east, were found in the village of Kuosku. Since rivers were the main routes of communication, habitation was concentrated on their shores. Christianity spread to Savukoski in the 1600s from Russia, judging by some finds. The first Finnish settler, Jaakko Karppinen, is mentioned in written records in 1697. The plentiful game and fish stocks attracted increasing numbers of Finnish settlers to the area, which eventually absorbed the local Sámi population. Both the Swedes and the Russians taxed the inhabitants. 

The beginning of the 20th century was a time of massive logging operations in the municipality. The most famous of these was Hugo Richard Sandberg's experiment with mechanized logging in Tulppio, where steam engines brought from America were used to transport logs. One of the engines has been restored and is now on view in Tulppio. The lumberjacks’ protest against their living and working conditions was one of the causes for the so-called ‘Bacon Rebellion’, which began at the Värriö logging site in February 1922.

World War II effected Savukoski greatly. During the Winter War the Savukoski inhabitants were forced into evacuation when the Soviet forces attacked from the direction of Salla. In later developments of the Continuation War, Soviet partisans attacked the villages of Kuosku and Seitajärvi killing inhabitants and burning the villages. Toward the war’s end, as the German forces retreated toward Norway, they destroyed nearly all of Lapland. The destruction in the sparsely populated municipality of Savukoski was almost complete.

After the war, the great logging camps were re-established. As a consequence, Savukoski’s population size was the largest at the beginning of the 1960s, about 2 400 inhabitants.