The Village Settlements were communes set up by the South Australian government under Part VII of the Crown Lands Amendment Act 1893, a scheme intended to mitigate the effects of the depression then affecting the Colony. It followed the New Zealand Village Settlements Act and similar schemes in Canada and New South Wales, and concurrently with Victoria. It followed the "blockers" scheme espoused by George W. Cotton.
Thirteen settlements were surveyed: Lyrup, Pyap, Kingston, Waikerie, Moorook, Ramco, Holder, Murtho, New Residence, Gillen, New Era and Charleston-on-Murray all on the River Murray, Mount Remarkable in the Mid North, and Nangkita to the south of Adelaide.
Holder and Murtho were proclaimed as Village Settlements by May 1896, Lyrup, Pyap, Kingston, Waikerie, Moorook and Ramco followed.
The Village Settlement Aid Society was formed to give financial and other assistance to the "villagers". Its hard-working secretary was Thomas Hyland Smeaton.
Some 2–3 miles (3–5 km) upstream (north) from Renmark, Murtho was better financed than the others, demanding £60 from families and £40 from singles as start-up capital. Its chairman was Henry Cordeaux ( –1902). Dubbed "gentleman farmers", the Murthoites were Utopian idealists rather than impoverished workers. Among those who lost substantial sums were John Napier Birks (1845–1929) and Walter Richard Birks (1847–1900), of Adelaide's prominent Birks family. In 1897 some 60 or 70 acres were under irrigation, but the project was abandoned in 1899 after most settlers had left. A major factor in the failure of Murtho was the expense and problems involved in pumping the water: the land allocated was some 120 feet (37 m) above the river level, necessitating an expensive and inefficient double-acting plunger pump. The settlers were incapable of the communistic spirit needed for the project to survive crop failures, and the Government-appointed manager (Samuel McIntosh) made only occasional contact with the settlers. Transportation of supplies and produce was hugely expensive, slow, intermittent and unreliable.