The village is situated on the bank of the Sauble River and was known as Driftwood Crossing. Its name today is a combination of the name of the first settler, Allen and ford which was added because this was the place where the river was the most easily forded.

The first house was built by James Allen, the first settler to Allenford in 1857, on the farm owned by Wilfred Rowe, on the South Bruce Peninsula side of the highway. James Allen, at the age of 6, came from Ireland in 1832 with his parents who settled first in Peterborough County. He came to settle here in April, 1857, on lot 9 and 10 con A and Allenford stands on part of his land. The southern part of the village is on lots in Arran Elderslie. James Allen was an Indian agent for several years.