Aberfeldy is on Mount Lookout in the Great Dividing Range, on the ridge between the Thomson and Aberfeldy Rivers, about 75 km north of Moe and 125 km east of Melbourne.
Gold had been discovered throughout the area, with rushes occurring at Gaffney's Creek in 1860, at Wood's Point and Matlock in 1861, on the Aberfeldy River and Donnelly's Creek in 1862 and on Stringer's Creek (later Walhalla) in 1863. After initial alluvial mining, gold bearing reefs were discovered, and in 1871, the first reef on the ridge at Aberfeldy was opened up.
A township, first known as Mount Lookout, was soon established. The name Aberfeldy is from a Scottish town. There were soon hotels, stores, bakers and butchers. A school was opened in 1872. The Australian handbook of 1875 described the town:
The soil was fertile so potatoes and other crops were grown. Some sheep and cattle were grazed and pigs kept within rock fences. However, few of the mines realised expectations. There was a revival in the 1890s but the township decreased considerably in size, as shown by the 1903 Australian handbook entry:
A couple of companies were still doing well at the beginning of World War I. In 1913 the population was about 70. Although this was reduced by the end of the war, the town still survived, focused around the remaining hotel. However this burnt down in 1938 and most of the town buildings were destroyed by bushfires in 1939. The school operated intermittently from 1910 to 1941, when it was closed. A guesthouse with tennis courts and swimming pool was built in 1941 as a tourist development, but this was not successful. By 1950 a road was constructed through to Matlock, but even today access is poor with only a gravel road, narrow and winding in parts.
A landmark on the roadside near Aberfeldy is Kitty Cane's grave. A former dance hall girl and owner of a shanty, Kitty Cane was believed to have weighed over 120 kilograms. When she died, the miners could only carry the coffin for a short distance, so she was buried beside the track.
There are a few permanent residents in the area. Some chimneys and stone fences remain and the site of the old hotel is recognisable. The cemetery is bleak and windswept but has panoramic mountain views, at one of the highest settlements in Victoria.
The general direction of gold discoveries was southwards from the upper reaches of the Goulburn River, north of the dividing range. As fossickers crossed the range they found gold at Matlock and further south in the Jordan valley. The main places of settlement along the valley were Jericho (town surveyed 1866), Red Jacket and Blue Jacket. They lie between five and seven kilometres north-west of Aberfeldy. All had a post office, school and hotel at various times. Jericho was the biggest, with a population of 500 or more in 1864. Mining at Jericho was overtaken by sluicing with operated from 1895 to the mid-1950s. Jericho’s hotel closed in 1935.
Aberfeldy’s census populations were:
J. Adams, Mountain gold: a history of the Baw Baw and Walhalla country of the Narracan Shire, Victoria, Trafalgar, 1980
O.F. Tomlin, Gold for the finding: a pictorial history of Gippsland's Jordan goldfield, 1979