It was one of six cattle stations which swallowed up all of the local land.

In 1853 George Veness selected a property at the confluence of the Namoi and Manilla rivers, capitalising on what was then a teamster's campsite known as The Junction. He built a wine shop, a store and a residence and later became the first postmaster. Veness was asked by the postal department to choose a title for the village and named it after the Manilla River which had originally been called the Manellae, either a reference to the tribe which hunted its banks or a Kamilaroi term meaning winding river. It is said an ex-sailor familiar with Manilla in the Philippines instigated the change.

The town was laid out in the early 1860's by Arthur Dewhurst and he named its streets after himself, his wife, their English home towns, his chair man and his employer. It was gazetted in 1863 although a major flood the following year swept away a number of buildings and killed four of the twelve residents.

In 1866 Manilla was described by the NSW Gazetteer as a postal town in a pastoral and quartz mining district. There was a hotel, an inn and a district population of 50. However, over the next 35 years there was considerable development and population growth facilitated by closer settlement after the passing of the Robertson Land Act, the construction of a bridge over the Namoi River, the coming of the railway to Tamworth in 1878 and to Manilla in 1899, and the development of the wool and wheat industries.

The boom years of 1894-1900 recorded a swell of building, although a series of fires the following decade destroyed many structures. Manilla became a municipality in 1901, at which time the population was 888.

Tobacco was commercially grown in the early years of the twentieth century.Bushranger Thunderbolt (alias Fred Ward) began a regular association with Manilla in 1865, taking two horses from Lloyd's station and committing a series of robberies on the Barraba road. In 1867 he bailed up the Tamworth mail 3 km from Manilla. He then proceeded to Hill's public house where he partook of refreshments. At the Veness store and hotel he robbed everyone, pilfering clothes, spirits and groceries. The police arrived and he fled without his pack horse which carried some of his gains. He returned later that year to rob the mail coach.

The Post Office Hotel is the oldest continuous business on the same site in Manilla. It was built as The Junction Hotel in 1882. It was burnt out and rebuilt in 1902 with a second storey added in 1906. It was given its current name in 1913.

Manilla has also had its share of famous faces. Rugby League great Dally Messenger (1883-1959) took up residence in Manilla in 1917 and held the licence of The Royal Hotel. He introduced the game of Rugby League to locals and was instrumental in the foundation of Manilla Rugby League Club. In 1984, Manilla teenager Fiona Coote became Australia's second and youngest heart transplant recipient. Fiona underwent a second transplant operation in January 1986. She officially opened Tourism Manilla’s Visitor Information Centre in May 2007.