At one time, flax was the only crop grown in the area, so the name came easily. The first settlement was located 2.5 miles southwest of the present site and went by the name of Boyer. The town was moved to its present site when the Great Northern Railroad came through. The first post office was established in 1914 with Martha Bledsoe as postmaster.
Flaxville is located in north-eastern Montana, just south of the Canadian border at the junction of Highway 251 and Montana Highway 5.