The two villages "Gräfinau" and "Angstedt" were first mentioned in 1282. The name Gräfinau probably went back to gräfliche Ouwe (Aue), while Angstedt referred to Stätte des Ank (old German for angel). They belonged to the county of Schwarzburg, Gräfinau to the Rudolstadt line and the office of Stadtilm, but Angstedt to the Sondershausen line and the office of Gehren. The church of Angstedt was built in the 13th century. In 1827-1831 the present church was rebuilt. Gräfinau was parished to Angstedt until 1826. For centuries the inhabitants lived from agriculture and forest work. In Gräfinau there was a manor, which belonged to the lord of Witzleben in 1453 and was dissolved in 1768. During the Peasants' War in 1525, the peasants of Angstedt submitted claims formulated in 24 articles. After the defeat of the peasants they had to pay 50 gulden penalty and lost the brewing and bathing rights. Especially in the 18th and 19th century many inhabitants worked as carters and traders, who drove Thuringian goods such as glass, porcelain and soot to Hamburg and brought back skins, cheese, tobacco and the like. From this time comes our original "The last carter".

The two villages were then merged in 1924 to form the joint village of Gräfinau-Angstedt. Since then, agriculture and small trade have played a major role. Until 1989, Gräfinau-Angstedt was the only company in the former GDR that produced felt slippers. Furthermore, parts of the knitting factory Apolda and the relay technology Großbreitenbach were located here. Today, the town is home to a regular school, a newly built daycare center, a newly built nursing home, various sports facilities, and a residential and commercial area. Dominant businesses are the Kyffhäuser Qualitätsbullen GmbH, the glass center Knoch and the company Straßen- und Tiefbau Schramm.

On March 31, 1994, the three mayors of Bücheloh, Gräfinau-Angstedt and Wümbach signed a document in Bücheloh during a ceremonial act, which sealed the foundation of the new unified municipality of Wolfsberg. Gräfinau-Angstedt was the seat of the administration of the Wolfsberg municipality.

In July 2018, the former district of Wolfsberggemeinde was incorporated into the city of Ilmenau as a new district.