The Village of Morley was established in 1869 due to the Grand Rapids and Indiana Railroad Company's construction of a railroad. The first Morley plat was completed in April 1870 for the railroad. Many mills and factories were located in the Village during the early years. A clothespin factory, a pickle factory, a grist mill, a lumber company, two hotels, plus many more businesses have been located in the Village.
Morley is part of Aetna and Deerfield Townships with the dividing line at East Street.
The Little Muskegon River has been an important asset of the Village's with log drives and mills using its water for power. A dam was built in early years which powered many mills. It was operated by local citizens at first but Consumers Power Company purchased it for a power plant some years later. It is not currently a power plant but still creates an impoundment behind the Morley businesses which is used for fishing and recreation. The dam is now owned by the Village of Morley.