Möschlitz, situated on the road from Schleiz to Burgk, was originally a Sorbian settlement. It was first mentioned in a document in 1333 as "Mouslitz", later referred to as "Muslitz, Muschlitz and Meuschlitz". In 1365, it is mentioned as the Frondorf of Burgk Castle. It always remained connected to the lordship of Burgk and the later district of Burgk in the principality of Reuß older line. In 1366, the village was sold by Bailiff Henry the Elder of Gera to the Teutonic Knights of Schleiz for 600 Meissen groschen. However, the Reussians soon bought it back. As early as 1597, Möschlitz was no longer referred to as a village but as a market town. It therefore had rights that elevated it above the villages in the neighborhood. For example, it held two annual fairs: on the Monday after Easter and on the Wednesday before St. Gall's Day. The people of Möschlitz were entitled to brew beer. Möschlitz was the place of execution for the lordship of Burgk. In the 16th century, the market town had a "Fürsteher", who was elected by the community every three years, two "Zugvögte" for the "Aufbietung und Anführung der Gemeinde", four "Vierleute" and a clerk, who also acted as cantor. A pastor Berthold was first mentioned in Möschlitz as early as 1333. However, today's church was built in 1877. In 1607, the white tanner Nicol Behr was granted permission to build an inn. He was allowed to brew beer and even serve wine, which in Schleiz was only permitted in the Ratskeller. In the Möschlitz mill (first documented mention in 1498), Henry II, Reuss of the older Burgk line, even founded his own mint in 1621. However, the money minted here was so inferior that the mint was closed again in 1622. From 1845 to 1889, the pharmacy in Möschlitz was the nucleus of the earliest incense candle production, which was later continued in Schleiz. For this reason, there was also a "black mill" in the village during these years, which ground charcoal. In 1809, the population of Möschlitz (Reuss older line) and neighboring Oschitz (Reuss younger line) almost came to war-like conflict. Napoleon's youngest brother, Jerome Bonaparte, was camped near Schleiz with large numbers of troops and was preparing to intervene against Austria. The masses of soldiers wanted to be fed. The farmers of Möschlitz took their cattle to safety in the surrounding woods to escape the threat of plundering. However, the hiding place was betrayed by the Oschitzers in order to protect their livestock. The angry Möschlitzers then armed themselves to get back at the treacherous Oschitzers "abroad". It was only the intervention of the provincial government that prevented a bloody confrontation at the last minute.

Möschlitz was an efficient agricultural village, for many years (since 1616) a school with its own gymnasium and had several efficient trades, among which bricklayers, roofers and carpenters are particularly noteworthy. These tradesmen usually worked away from home from spring to fall, a situation that is becoming increasingly important again today. In 1930, Möschlitz was connected to the Schleiz - Saalburg railroad line on the outskirts of the village, but this is no longer used today. In the spring of 1945, SS guards murdered the rest of a train of concentration camp prisoners who were to be driven from Buchenwald concentration camp towards Bavaria. They were found in a small pond between Möschlitz and Burgk and a memorial was later erected there.