Shaw lies on the main A365 Bath road from Melksham.
The manor of Shaw was first mentioned in the 13th century, when it formed part of the barony of Castle Combe. It would seem likely that the original manor house was on, or near, the site of the present Shaw House, not the Shaw Country Hotel (2003). It would also seem likely that early settlement was to the north and south of the manor house, probably along the Melksham Road. It would seem possible that there was settlement on Shaw Hill at a fairly early date, although "Shawhill" is not mentioned by name until 1669. By 1773 there was a line of dwellings along the Melksham road but a far larger settlement on Shaw Hill.
Shaw means a wood or copse, this may indicate the condition of the area when it was first settled as there is no nucleated settlement. Certainly medieval Shaw was a small community centred on its manor house and the chapel here seems to have had more to do with the barony of Castle Combe than local needs. The settlement remained small and rural but by the 17th century there were a reasonable number of houses. In the mid-17th century it became a stronghold of the Society of Friends with Quakers travelling from around the area to meetings here. Being about 2 miles from the town of Melksham it was unlikely that too much notice of such meetings would be taken during the time of non-conformist persecution prior to the 1688 Act of Toleration.
For much of the 17th century Shaw House and Farm were owned by the Ashe family of Freshford but in 1701 it was sold to Thomas Smith, who rebuilt the mansion. For the next 50 years Shaw House seems to have been a centre for social life in this part of Wiltshire and this is reflected in a diary which Smith kept from 1715, covering most of the time until his death in 1723. Information on this diary can be found in "The Diary of Thomas Smith of Shaw 1715-23" by Edward Bradby. WAM, Vol. 82, pp 115-141, 1988. After 1759 the property belonged to the Neale family and in the early 19th century the house was let as a private school.
The population grew during the 19th century and a church and school were provided. Most people were either employed in agriculture or worked in the growing town of Melksham. In Shaw in the 1870s there was a post office, a grocer, a brewer and two coal merchants and the postmaster also made shoes. For everything else the inhabitants had to go to Melksham or to the baker at Whitley. In the latter part of the 20th century there was more building on and around Shaw Hill.