The town was named after the South Australian Labour politician Egerton Lee Batchelor (1865-1911) who became Minister for the Northern Territory in 1911. The town was of little consequence until it became a large Allied airforce base during World War II. Prior to that it has seen brief periods of mining activity and at one point, in order to try and encourage settlement of the area, the South Australian government had given away blocks of land. At another time it was a centre for market gardening when Chinese gardeners moved into the area.
Batchelor's moment of glory occurred in 1949 when Jack White discovered uranium at Rum Jungle. Mining in the area began in 1952 and the town grew rapidly during the early 1950s. The mine was closed in 1963 and the uranium treatment plant closed down in 1971.
Today, with a population of 358, the town's survives on tourism (particularly as a major access point to Litchfield Park) and the Batchelor TAFE, a unique residential tertiary college specifically catering for Aboriginal students.