The area around Crab and Wilson creeks were inhabited by Native American peoples until the arrival of settlers in the late 19th century. John Marlin and the Urquhart Brothers established their homes in the area in 1870s and were followed by a military road connecting Fort Walla Walla to Camp Chelan that passed near the area. A railroad was built through the area in 1892. Wilson Creek was platted in 1903 and officially incorporated on May 8, 1903.
When Grant County was created in 1909, Wilson Creek was its largest town with around 600 people. The town grew little, however, and by the mid-20th century had been surpassed by Ephrata and Quincy. Despite the slowing of growth, Wilson Creek established a port district in March 1960. The Port of Wilson Creek is home to an airport, which was renovated in 1984 and again in the 2000s when updates were made to the 3,074-foot (937 m) runway.
Wilson Creek is located at 47°25′25″N 119°7′21″W (47.423499, -119.122397) alongside a creek of the same name. Crab Creek, into which the aforementioned creek flows, runs along the southern side of the town. Just west of town along Crab Creek are Billy Clapp Lake and the Pinto Dam, both of which are part of the extensive Columbia Basin Project. State Route 28 passes immediately south of the town site as it follows the valley of Crab Creek, connecting Wilson Creek to Soap Lake to the west and Odessa to the east.
According to the United States Census Bureau, the town has a total area of 0.96 square miles (2.49 km2), all of it land.