Cut Knife is named after Cut Knife Hill (now called Chief Poundmaker Hill) situated on the Poundmaker reserve.
On 2 May 1885, a military force of 332 Canadian troops, led by Lieutenant-Colonel William Dillon Otter, attacked Poundmaker's camp near Cut Knife Hill.
On May 2, 1885, he led a Canadian force of more than 300 in the Battle of Cut Knife against Poundmaker's Cree Indians.