Attractions in Ermelo include several nearby dams that provide excellent fishing and other forms of watersport, and San paintings located on the Welgelegen farm. Of special interest in the area are the Leghoya Stone Huts on top of the Tafelkop Mountains, which date from the 14th Century.
Ermelo developed from the site of a church built in 1871 by the Rev Frans Cachet and the site named after his friend from a town named Ermelo in the Netherlands. The first trade licence being granted in 1884. Because of the numerous small lakes and rivers of the region and well before the town was formally established, the site had been used for many years as a stopping place for wagon trains travelling between Lydenberg on the Mpumalanga Escarpment and Natal. The area was well known for its horse breeders and small livestock, and the first agricultural show was held in 1889. Ermelo was completely destroyed during the 2nd Anglo-Boer War and has been rebuilt since to become the pride of the Eastern Highveld.
The area around Ermelo has developed into an important center for beef and sheep farming, as well as sunflowers, grain and potatoes.