Water played an important role in the development of Seneca Falls. The rapids originally found in the Seneca River attracted businesses that used the waterpower to develop mills, distilleries, tanneries, and factories of all types, such as the Seneca Knitting Mills, still in operation. By 1818, locks had been constructed creating the first version of the Cayuga -Seneca Canal, which allowed boat traffic to avoid the rapids. Ten years later, the Cayuga-Seneca was linked to the Great Erie Canal. The cultural diversity of Seneca Falls is a result of the arrival of immigrant workers who originally came to build the canal and the railroad, staying to make Seneca Falls their home. The manufacture of pumps has been a large part of Seneca Falls' history since the early 1800's. Goulds Pumps, Inc. remains a major local industry.

By the mid- 1800's, Seneca Falls was also building a reputation as a center for social and religious reform. Abolition of slavery, temperance, and women's rights were issues supported by many local residents. Seneca Falls resident Amelia Jenks Bloomer drew international attention to the women's rights movement by advocating and wearing the costume that bears her name. In July of 1848, local resident Elizabeth Cady Stanton along with four other women, including Mary Ann M'Clintock and Jane Hunt of nearby Waterloo, convened the first Women's Rights Convention. Women's Rights National Historical Park, the Seneca Falls Urban Cultural Park, and the National Women's Hall of Fame are all lasting legacies of this landmark event.

In 1915, the State widened the old Cayuga-Seneca Canal and replaced the old smaller locks with the larger two-lock combination that exists today, in the process flooding what was once known as "The Flats", thus erasing from existence over 116 industrial buildings and over 60 homes. Van Cleef Lake was created during this project as a reservoir for the locks and the Cayuga-Seneca Canal is of increasing importance to Seneca Falls.

Recently, Seneca Falls received national attention as the likely inspiration for the fictional town of Bedford Falls in Frank Capra's classic holiday movie "It's A Wonderful Life." Residents and visitors agree, it's a wonderful and historic place to be!