McGrath lies in Interior Alaska adjacent to the Kuskokwim River
. McGrath was historically an Upper Kuskokwim Athabascan village, and was used as a meeting and trading place for nearby village residents. When gold was discovered at Ganes Creek in 1907, McGrath became a regional supply center, since it was the northernmost point on the Kuskokwim River accessible by large riverboats.
McGrath became an important refueling stop during WWII, as part of the Lend-Lease Program between the U.S. and Russia.
Today, McGrath functions as a transportation, communications, and supply center in Interior Alaska. Many families have dog teams which they enter into the Iditarod Trail Sled Dog Race, and other sled dog races.