Attalia was formed by the Columbia Canal Company, who platted the town and began selling lots. A post office called Attalia was established in 1906, and remained in operation until 1952. According to tradition, the town was named after a place in Italy.
Attalia was a stop on both the Northern Pacific Railway and the Oregon Railroad and Navigation Company in 1909. In 1917, the town water pump caught on fire and the Northern Pacific Railway refused to fix it, leaving the citizens with no fresh water. During the 1920s, the town had a newspaper, The News Tribune. Some amount of oil exploration also took place during the 1920s, but never amounted to anything. The inhabitants eventually left and what remained of the town was replaced by industry, grain silos, and factories. Today a river port and several industrial companies are located on top of the former town site.