Allenby was first settled in the 1400's by the Huron Tribe, which had a village in the area until sometime in the early 1700's. This village is described in Lyman B. Jackes, "Tales of North Toronto", as "a well organized and extensive community that had its centre in an artesian spring of pure water. The spring flowed where the modern water tower rears its head on Roselawn Avenue, just to the west of Avenue Road. The great tribal huts were on the site of the present day Allenby Public School."

Jackes goes on to say that the Allenby school hill is not natural but was man-made, the result of Huron's practice of burrowing food stocks underground. The water tower that Jackes refers to on Roselawn Avenue is now a police communications tower.

The present day neighbourhood was developed when Allenby Public School opened in 1927. The school was named after Lord Allenby, a British World War One hero.