The land that comprises Nance County was originally part of the Pawnee Reservation, created in 1857 when the Pawnee Indians signed a treaty with the United States ceding its lands in exchange for the reservation. After the state of Nebraska was admitted into the Union, the state government extinguished the tribe's rights to their land. It soon sold the land and used the proceeds to defray expenses to obtain lands elsewhere for the Indians. In the mid-1870s the remainder of the reservation was sold, and in 1876 the tribe was relocated to its present-day location in central Oklahoma. The boundaries for Nance County were approved in 1979. It was named after the Governor Albinus Nance.
Nearly all the land in Nance County was purchase by settlers or by investors for resale, instead of the homestead provisions common to most of Nebraska