During the British colonial period, the earliest settlers of European descent arrived in this portion of New Jersey about 1715 and established "Bottle Hill" at the crossroads of Ridgedale Avenue and Kings Road. The Luke Miller house at 105 Ridgedale Avenue is thought to be the oldest remaining home, having been built around 1730. Morris County, created in 1739, was divided into three townships. The portion of Madison north of Kings Road was put under the governance of Hanover Township and the portion to the south, under the governance of Morris Township. A meeting house for the Presbyterian Church of South Hanover, as Madison was called at the time, was started in 1747 where the Presbyterian Cemetery still exists between Kings Road and Madison Avenue.

During a reorganization of Morris County in 1806, Chatham Township was formed to include the villages of the current Madison, Chatham, and Florham Park as well as the lands still governed by the current Chatham Township, and thus the governmental division of the village was ended. In 1834, the name of the village was changed to Madison. On December 27, 1889, based on the results of a referendum passed on December 24, 1889, the village seceded from Chatham Township and adopted the borough form of government in order to develop a local water supply system for its population of 3,250. Madison annexed additional portions of Chatham Township in 1891, and each year from 1894-1898, followed by an exchange of land in 1899 with Chatham Township.

Madison's growth accelerated after the Civil War. The railroad provided good transportation for its farm produce. Later, the railroad made possible the establishment of a flourishing rose growing industry, still commemorated in Madison's nickname, The Rose City. The Morris and Essex Lines became one of America's first commuter railroads, attracting well-to-do families and contributing to the development of "Millionaire's Row," which stretched from downtown Madison to downtown Morristown.

The rose industry and the large estates in the area attracted working class people of all kinds. As a result, Madison very early developed a diverse population, both in terms of socio-economic status and ethnic background. The original settlers were of British stock; French settlers came after the American Revolution; African Americans have been members of the community from early in the 19th century; Irish came in mid-19th century. One of the first Irish Families to arrive was that of Patrick Cosgrove who eventually built greenhouses to grow roses for the New York Market. These were built behind his house on Sampson Avenue. There was an extension to Main Street where there is a flower shop to this day. His grandson, Robert Cosgrove was post master in Madison for many years.; and then Germans and Italians around the turn of the 20th century. To this day there is a substantial population of Italian descent in Madison. Today Madison remains a diverse community, with many of the more recent newcomers arriving from Central and South America, and from Asia.

Demographics of

According to the 2002 results of the National Jewish Population Survey, there are 12,600 Jews in Livingston, approximately 46% of the population. This is one of the higher percentages of Jews in any American municipality.

There were 5,520 households out of which 31.3% had children under the age of 18 living with them, 57.6% were married couples living together, 8.2% had a female householder with no husband present, and 31.4% were non-families. 25.6% of all households were made up of individuals and 10.0% had someone living alone who was 65 years of age or older. The average household size was 2.53 and the average family size was 3.05.

The population was spread out with 20.6% under the age of 18, 17.6% from 18 to 24, 28.3% from 25 to 44, 20.5% from 45 to 64, and 13.0% who were 65 years of age or older. The median age was 34 years. For every 100 females there were 90.0 males. For every 100 females age 18 and over, there were 86.7 males.

The median income for a household was $82,847, and the median income for a family was $101,798. Males had a median income of $62,303 versus $42,097 for females. The per capita income was $38,416. About 2.0% of families and 3.4% of the population were below the poverty line, including 2.8% of those under age 18 and 4.3% of those age 65 or over.

New Jersey Transit's Madison station provides commuter service on the Morristown Line, with trains heading to Hoboken Terminal, and to Penn Station in Midtown Manhattan via the Kearny Connection.

Giralda Farms, a planned office development, occupies 175 acres (0.7 km²) of the former Geraldine R. Dodge estate in Madison. Five of a possible seven projects have been completed. These include the corporate headquarters of Atlantic Mutual Insurance, Maersk Lines, and Wyeth (formerly called American Home Products), and the offices of Schering-Plough. Development regulations for the former estate require that 85% of the land be maintained as open space with almost all vehicle parking underground.