The following is quoted from Thomas Murphy's 1928 History of Lackawanna County . 1 (Remember that references to now or today refer to 1928 and do not necessarily reflect life in 2003.)
Dalton to an early generation was known as Bailey Hollow from the predominance of families of that name who were pioneers in the section. George Bailey was the first of the family to settle in the Abingtons, coming in 1801. Its location and accessibility quickly made Bailey's Hollow a general gathering and trading point, rivaling Waverly. Pioneer families in Dalton included the Purdys, Smiths, Edwards, Dupues, Careys, Nichols, Marcums, Gardners, Greens, Northups, Woodbridges, Dixons, Ellis', Halsteds, Grahams, Warners, Colvins, Deans, Kennedys, Bartons, Madisons, Lampmans, Briggs', and Athertons. Dalton had a church in 1846 and a post office in 1854. One of the earliest schools in Abington was located in Dalton. A hotel built a full 70 years ago provided entertainment and shelter for the stranger. Agriculture and lumbering were the chief, in fact, the only employment, until the building of the Leggetts Gap, now the northern division of the Lackawanna Railroad, about 1850. When that line was projected there was a question whether to run it by way of Bailey Hollow and Martin's Creek or Waveryly and Shieks Pond (Lake Sheridan). Col George W Scranton decided in favor of the Dalton route. For some years after the railroad was built there was no station at the Hollow. Glenburn had been favored because of the outlook for business from Palmer's Mill. With the establishment of a post office in 1854 the railroad authorities sometime in the sixties favored Dalton with a station, which was built by public subscription. The village proper then began to take shape.
Dr J C Miles, who had come into the Abingtons as early as 1847, locating in Waverly, moved to Dalton in the sixties and built a fine home overlooking the town on the north and on the road to the Abington Country Club. He was a progressive spirit and by some is credited with changing the name of the town from Bailey Hollow to Dalton. Likewise Dr Miles brought about the removal of the bodies from the Bailey family cemetery, located on part of the present ICS farm. A cemetery across the way was hardly a good advertisement for a physician. It is related that when the bodies were disinterred, two were found to be petrified. A J Casey now owns the Miles home. Previous to Dr Miles locating in Dalton that community relied on the services of Drs William N and Hiram Nichols at Clarks Green or Drs Bedford and Waever (sic) at Waverly.
Abel Gardner was one of the first merchants in Dalton.