Nelson is the last township encounted in Victoria using the coast road to Mount Gambier. Nelson is a typical coastal village. The river accentuates the quiet delight of this hamlet. Nelson is one of those places, that if the weather is being kind it is easy to linger awhile.
In January 1852 the name of Nelson was adopted for the settlement, after the ship Lady Nelson which was used by Lieutenant James Grant in explorations of the area in the early nineteenth century.
A punt was built across the river in 1848 by Henry Kellett. A summerhouse was also built in 1848, which later became the town's current hotel. The town site was surveyed and named in 1852 by Lindsay Clarke, and sheep grazing began soon after. Settlement of the township came much later, a Post Office being opened on March 17, 1876.