Gerdstown was founded in 1863 by Jason Gerd (born Jason Gherd) and Thomas Krimms. It was incorporated as a town in 1867. In 1868, construction on the town's first Town Hall, which was completed in 1872. In 1879, Gerdstown began holding town meetings. In 1897, Gerdstown served as "county seat for a day" while renovations were being done on the City Hall in Fredricsburg. In the late-1940s, the current Gerdstown Town Hall's construction began. It was completed in 1951. In 1972, a new truck stop was built just off of Dragoonasag Interstate Route 92, which brought more business to Gerdstown. In 1992, then-mayor Josh Cratowskey announced a new curfew for Gerdstown residents, stating that everyone living in Gerdstown had to be indoors by 9:00 p.m. Gerdstown was voted the "twenty-sixth best place to raise a family in Salviana" in 2006.
The current mayor of Gerdstown is John Lee Brantz. The mayor of Gerdstown, like the mayors of other cities and towns in Salviana, serves two-year terms and may not serve more than five terms. Members of the Town Council serve two-year terms and may serve up to four terms.
Gerdstown is served by the Gerdstown School System, which includes Gerdstown Elementary School, Gerdstown Middle School, and Gerdstown High School.