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Leyden was first settled in 1737 as part of "Fall Town," which also included Bernardston and Colrain. The town was set off from Bernardstown in 1784, but it was not incorporated until February 22, 1809. The town was named for the town of Leiden, Netherlands, refuge of the Pilgrims before colonizing the Americas. Leyden had several small industries in the eighteenth century, including grist mills, wood product mills, and dairying, but today the largest industry is maple sugar production. The town also has a reservoir which supplies the town of Greenfield.