Townsend was first settled in 1676, and was officially incorporated in 1732. The town was named after Charles Townshend, English secretary of state and an opponent of the Tories.

According to the United States Census Bureau, the town has a total area of 33.1 square miles (85.8 km²), of which 32.9 square miles (85.1 km²) is land and 0.2 square mile (0.6 km²) (0.72%) is water. Townsend has the largest land area of any town in Middlesex County.

Townsend is bordered by Mason, New Hampshire and Brookline, New Hampshire to the north, Pepperell to the east, Groton and Shirley to the southeast, Lunenburg to the south, and Ashby to the west.

Route 119 runs east-west through Townsend, and Route 13 runs north-south.

As of the census of 2010, there were 8,926 people, 3,240 households, and 2,483 families residing in the town. The population density was 279.8 people per square mile (108.0/km²). There were 3,516 housing units at an average density of 96.9 per square mile (37.4/km²). The racial makeup of the town was 96.7% White, 0.6% Black or African American, 0.2% Native American, 0.8% Asian, 0.0% Pacific Islander, 0.4% from other races, and 1.3% from two or more races. Hispanic or Latino of any race were 1.8% of the population.

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