Located primarily in Madison County, near the northern border of the state of Alabama. Madison extends west into neighboring Limestone County. The city is included in the Huntsville Metropolitan Area. Madison is bordered by Huntsville on all sides.
This area was occupied historically by the Koasati (also known as Coushatta), a Muskogean-speaking people and, before them, thousands of years of indigenous cultures.

Madison's first European-American resident was John Cartwright, who settled in the area in 1818. The city was originally known as Madison Station, and it developed in the 1850s around a stop of the Memphis & Charleston Railroad. Textile mills were built in the area in the late 19th century for processing of cotton.

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