The name 'Mudu' is derived from a story about Xishi, one of the Four Beauties in Chinese history. It is said in the Spring and Autumn Period (773BC-476BC), Fuchai, the king of Wu, obliged workers to build a Guanwa Palace in order to please the Beauty Xishi. Then, considerable wood was carried here so that the river in this area was blocked. This was called 'jimusedu' (which means the accumulated wood blocks the river). So, the town was named 'Mudu'.

During the three-Kingdom era, Mudu was the important stronghold in the southern area. It was also the Buddhist holy land. In Song dynasty, it was the center of west area of Suzhou, and one of the six towns in Wu County. During the mid-period of the Qing Dynasty, Mudu was the famous business area. During Emperor Kangxi’s three-time southern visits and Emperor Qianlong’s six-time southern visits, Mudu was their preferable place for each time. During the time ruled by Kuomintang, it was the administrative center of west of Suzhou.

Mudu is a cultural and educational center, from 1015 to the end of Qing Dynasty, more than 47 famous learners succeeding in royal exams. The famous men include: Fan Zhongyan (a famous official who administrated a famous reform in the Song Dynasty, and wrote the classical article Yueyanglouji), Feng Guifeng(a famous reformist in the late period of the Qing Dynasty) Sheng Deqian (a famous poet in the Qing Dunasty and one of Emperor Qianlong’s bosom friends in literature and poem writing) and so on.