Daykin was established in 1869 by John Daykin, a train conductor and stonemason from Illinois, who by local tradition is said to have conducted the train that carried Abraham Lincoln's body back to Springfield in 1865. The village later earned a folk-history nickname as the "Windmill Town," reportedly featured in Ripley's Believe It or Not during the 1930s for having more windmills per capita than any town in Nebraska, before a 1949 water tower replaced most of them.

Daykin is a village with a 2020 Census population of 157, down slowly from 177 in 2000. Its ZIP code is 68338. Surviving landmarks include the 1887 Jefferson County Bank building, the 1935 Daykin Community Building, and two churches founded in 1888. One windmill still stands on the community building lawn as a memorial to the town's namesake distinction.