The farming district of Kardella is situated in the South Gippsland hills, 12 km east of Korumburra and 127 km south-east of Melbourne.

The hilly and densely forested land was selected in the early 1880s. Roads were surveyed but development was slow. The railway line from Melbourne into South Gippsland was constructed through the area in 1891. Kardella, an Aboriginal word thought to mean possum, was chosen by the Railway Commissioners from several submissions to name the railway station.

A number of sawmills operated in the district, logging the magnificent blue gum timber. Tramlines carried the milled timber to the railway station. When some building blocks were surveyed near the station in 1892, a store was constructed. In 1893, a village settlement was begun at Kardella. After a false start clearing on the wrong block, the settlement was established south of the railway line. The settlers cleared the land, built cottages and cultivated garden plots. The increased population in the area allowed a school to commence classes in the newly constructed mechanics’ institute hall. A school building was acquired in 1897.

The village settlers struggled to survive, some seeking work outside the settlement. After a dispute, the uncleared land was surveyed into 10 acre blocks to be allotted by ballot and the settlement was disbanded. Some families left for other village settlements in the area.

By 1900, all the sawmills were closed, leading to a decline in station business and its eventual closure. Dairying was the major enterprise on the district’s rich soil. The village settlement blocks were gradually brought by neighbours, until by 1950 all were owned by a few farmers.

The hall was sold in the 1930s, due to its poor condition. When low attendances at the school led to its closure in 1944, the building was bought and altered to serve as a hall. However by the early 1970s, it was in bad repair and hardly used, so was given to Coal Creek Historical Park at Korumburra. The store closed in 1977.

Census populations for the Kardella district have been:

census date population
1911 321
1933 164
1961 136
2011 304*

* larger district, including Arawatta