Nespelem was founded by the Yakama leader Chief Kamiakin and officially incorporated on April 15, 1935. It is the site of a historic Nez Perce cemetery. Among those buried there is Chief Joseph.
As of the census of 2010, there were 236 people, 75 households, and 53 families residing in the town. The population density was. There were 77 housing units at an average density of. The racial makeup of the town was 10.6% White, 0.4% African American, 80.1% Native American, 0.4% Asian, 1.3% from other races, and 7.2% from two or more races. Hispanic or Latino of any race were 6.8% of the population. There were 75 households of which 42.7% had children under the age of 18 living with them, 24.0% were married couplesliving together, 29.3% had a female householder with no husband present, 17.3% had a male householder with no wife present, and 29.3% were non-families. 17.3% of all households were made up of individuals and 6.7% had someone living alone who was 65 years of age or older. The average household size was 3.15 and the average family size was 3.55. The median age in the town was 30 years. 29.2% of residents were under the age of 18; 15.7% were between the ages of 18 and 24; 24.6% were from 25 to 44; 21.6% were from 45 to 64; and 8.9% were 65 years of age or older. The gender makeup of the town was 52.5% male and 47.5% female.
2000 census
As of the census of 2000, there were 212 people, 71 households, and 48 families residing in the town. The population density was 1,130.9 people per square mile. There were 84 housing units at an average density of 448.1 per square mile. The racial makeup of the town was 13.68% White, 82.08% Native American, 0.47% Asian, 0.47% Pacific Islander, 1.42% from other races, and 1.89% from two or more races. Hispanic or Latino of any race were 3.30% of the population. There were 71 households out of which 35.2% had children under the age of 18 living with them, 35.2% were married couples living together, 22.5% had a female householder with no husband present, and 31.0% were non-families. 23.9% of all households were made up of individuals and 9.9% had someone living alone who was 65 years of age or older. The average household size was 2.99 and the average family size was 3.57. In the town, the population was spread out with 32.5% under the age of 18, 13.2% from 18 to 24, 17.5% from 25 to 44, 29.2% from 45 to 64, and 7.5% who were 65 years of age or older. The median age was 28 years. For every 100 females, there were 105.8 males. For every 100 females age 18 and over, there were 120.0 males. The median income for a household in the town was $30,000, and the median income for a family was $27,500. Males had a median income of $43,250 versus $27,500 for females. The per capita income for the town was $12,836. About 15.9% of families and 16.9% of the population were below the poverty line, including 28.3% of those under the age of eighteen and 4.8% of those sixty five or over.
