According to archaeologists, Arachova was established in 9th century BC, although this area did not hold the same name as today. One of the earliest findings is a prehistoric cave in Livadi that was used as a temple dedicated to God Pan. According to tradition, the women from the surrounding areas used to gather in this location every five years wearing disguises and they danced under the light of torches the whole night.
The name Arachova is apparently given to the place because of the many walnut trees that grow in the area, since the two Slavian words it is composed of are ara and hova, meaning walnut trees. There is another possibility, however, as the town has also been known as Rahova, a term that parts from two Geek words, rachi and Vio. Their meaning refers to those who live on the hills of a mountain, and this concerns the location of Arachova, as it is built on five small hills. Along the centuries, Arachova played an important role that made its name very famous in Greek history. The first record that refers to this town is the Illiad by Homer, in which two famous generals from the old towns of Anemoria and Kiparissos are mentioned, in the framework of the Trojan War in 2,000 BC. These generals were Epistrophos and Schedias.
Later on, Philip II of Macedonia destroyed the town around 334 BC, causing their inhabitants to get dispersed over the hills. Later on, Arachova was rebuilt. The following important testimonies about Arachova are given by travelers in the 14th century AC, who speak about a well-populated town with plenty of churches. The Metropolitan Bishop of Athens, Meletios, wrote that Arachova was the most famous town in Parnassus, while Lord Byron described the local women in 1809 as very caring and polite.
Some decades later, in 1826, the Greeks won the Turks in the historic battle of Arachova. The name of their chief, Georgios Karaiskakis, became very important in Greek history, after the defeat of the Turkish army and their chief Moustafabey. Today, Arachova is a popular winter destination in Greece and keeps attracting people mainly for the three ski centers of Mount Parnassos.