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The county was created in 1822 from parts of Botetourt County, Bath County, and Monroe County (now in West Virginia). At the time, the majority of the population lived around Covington, and the primary cash crop then was hemp, which was used for rope production.

As of the 2010 census, the population was 16,250, which is an increase of more than twenty-five percent from the 2000 census. The majority of that growth, however, can be attributed to the reincorporation of the formerly independent city of Clifton Forge back into Alleghany County in 2001.

Alleghany County was established on January 5, 1822, by an act of the Virginia General Assembly. The new county was formed from parts of Botetourt, Bath, and Monroe (now West Virginia) counties, with most of the population centered in the new county seat in Covington. Alleghany County was named for the Allegheny Mountains, which border the western edge of the County.

When the county was established, the principal export was hemp, used for rope production in Richmond. However, as hemp demand and prices declined, the farmers of Alleghany switched to grain, hay and livestock production.

During the American Civil War, the iron for the CSS Virginia (Merrimac) came from Longdale Furnace in the county. Regiments from Alleghany County were at the surrender at Appomattox.