Varakļāni was founded in the 18th century and was incorporated into the Russian Empire in 1772. The first community institutions were a hevra kadisha and cemetery. There were three synagogues in the town, a hasidic synagogue ('Die Weise Shul') and two synagogues for the mitnagdim. In the nineteenth century, most Jews were merchants of agricultural products. Other residents were craftsmen, including shoemakers and tailors. The Zogut family, which numbered at least 12, were all tailors.By 1897 the Jewish population of 1365 was 75% of the town. At the turn of the century, many Jews left for America. A cholera epidemic in 1900 resulted in many deaths. By 1935 because of expulsions, emigration, WWI campaigns, and the Russian Revolution, the Jewish population was half of what it was at the beginning of the 20th century.
In 1840 Rabbi Aharon Zelig Zioni, the son of Rav Naftali Zioni, headed the Jewish Community. In 1873, Rabbi Abraham bar Gabai became the head rabbi, and held the post for the next 50 years, followed by Rabbi Eliezer-Yaakov Hacohen Grodsky, who headed the community until the Holocaust.
The Talmud Torah under Rabbi Gabai in 1900 had 30 pupils. In 1905-06, hundreds of Jewish workers participated in the first Russian revolution. The community organized self-defense groups after the 1905 Revolution, due to fears of pogroms. During the First World War many Jews came to Varakļāni to seek refuge in the synagogues and storehouses. After the war, many younger people left for the larger towns. During the period of independent Latvia, a Yiddish-language kindergarten and elementary school were founded. The community had a library, drama circle, and an orchestra. In 1928, 90% of the businesses were owned by Jews. By 1935, this number had dropped by half, due to government 'Latviazation' policies.
Some of the families that lived in Varakļāni were:
Zogut Schneir Chait Kaplan Morain Matchevsky Steiner Boorenstein Berzon Kopolovitch Kodish Solevy Kagan Shvalb Fingerhuts
The Red army entered Latvia in the summer of 1940, nationalizing Jewish property and closing Jewish institutions. On June 28, 1941, the Soviets started to evacuate the town to the interior of Russia, and several hundred Jews escaped with them. The Germans entered the town at the end of June, and sporadic murders of Jews took place. Jewish property was confiscated, and Jews were pressed into forced labor. On August 4, 1941, the 540 Jews of the town were taken to the cemetery, where they were shot to death in pits that they had been forced to dig. The Russians liberated Varakļāni on August 2, 1944.