Powell Butte lies within historic territory of the Confederated Tribes of the Grand Ronde Community of Oregon, which covered more than and extended from the Columbia River to the Klamath River. At the end of the 19th century, much of the meadow area near Powell Butte was cleared and replaced with an orchard by settlers. In 1925, the Portland city government bought the land encompassing Powell Butte from George Wilson with the intent to use it for water reservoirs. They leased the northeastern part of the land to farmer Henry Anderegg, who owned and operated the Meadowland Crest Dairy until 1948. In the mid-1970s, Portland's Water Bureau created a development plan for Powell Butte including four underground reservoirs to be built at the northern side of the mountain. The first of these reservoirs was constructed in 1981 and the second in 2014.