The town is first mentioned in 1142 in Russian chronicles. From the late thirteenth century it was part of the Grand Duchy of Lithuania, and then the Polish-Lithuanian Commonwealth. In 1772 the Rahachow district was annexed by the Russian Empire.
On 16 July 1863 the local landowner Tomasz Hryniewicz was executed here by a Russian firing squad for leading the Rahachow detachment of Polish insurgents.
The notable Rabbi, Yosef Rosen (1858–1936), known as the Rogatchover Gaon ("The Genius of Rogatchov" (the Yiddish pronunciation of Rahachow)), was born and raised here. The artist Anatoli Lvovich Kaplan was born (1902) and brought up here, as was former NHL hockey player Sergei Bautin. Rahachow also has a popular dairy product factory in it, whose products are supplied across Russia, Ukraine, and Belarus.