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The history of the lower Naknek River has not always been peaceful. The original settlers were Alutiiq people, but they lost their place to Aglurmiut (Yup'ik) invaders in about 1800. At this time, the Alutiit retreated far up-river to the village of Severnovskoe (Savonoski). The Aglurmiut then built a new village at the river's mouth called Paugvik. During the 1800's, the Aglurmiut and Alutiiq peoples of the Naknek River remained enemies, even though both hunted for the Russian and American fur companies. The present village of Naknek, located near Paugvik, was started in the 1890's when American companies built a salmon saltery and cannery. Over time, Aglurmiut families at Paugvik moved to Naknek for cannery jobs and left their old village behind.
In 1912, the Katmai volcanic eruption destroyed the interior village of Savonoski and forced its Alutiiq residents to return once again to the mouth of the Naknek River. There they built New Savonoski, on the opposite bank from their old enemies at Naknek village. Later they moved again to the nearby cannery town of South Naknek. While they are close neighbors today, the Yup'ik and Alutiiq people at Naknek and South Naknek also recognize their differences in language, culture, and history.