In Av 5693 (August 1933), following the purchase of approximately 400 dunams of land by the Jewish National Fund (JNF) and a commitment to acquire additional land for future expansion, a final decision was made to establish the settlement of Kfar Yavetz.
The land was divided among 23 founding members, each receiving 3 dunams for residential use and 12 dunams designated for planting citrus orchards. In the winter of 5694 (1933–1934), the settlement was joined by a labor group that had separated from the Rodges Group (then based in Petah Tikva and later founders of Tirat Zvi), who called themselves Mishmar HaSharon.
From the perspective of the HaPoel HaMizrachi movement, the establishment of Kfar Yavetz held strategic and economic significance far beyond the modest size of its 23 founding families. While the orchard enterprise in the area originated as a private commercial initiative, not particularly attentive to ideals such as Hebrew labor, the members of Kfar Yavetz took it upon themselves to uphold and reinforce the achievements of the broader General and Religious Labor Movements. They were committed to demonstrating their efficiency and value as Jewish laborers.
By 5695 (1935), the settlement numbered 24 families. However, the organizational body encountered serious challenges, including protracted legal battles involving Arab squatters who had encroached on the land. As a result, the settlement struggled to gain stability. Only after considerable effort were they able to carry out land surveys, fence off both the orchards and the moshav, construct a water reservoir, and install a central plumbing system.
Some residents began building permanent homes with the support of the Batei Kfar (Village Homes) Company, while others continued to live in temporary huts. The settlement suffered from a lack of manpower and bore a heavy burden of taxation and self-defense responsibilities. Experts warned that without population expansion, the community would not be sustainable. They urged HaPoel HaMizrachi to ensure that the JNF would acquire additional land, especially in light of a recent Zionist Congress resolution that allocated funds for the settlement of 30 additional families.
During the 1936–1939 Arab Revolt, Kfar Yavetz, being both isolated and exposed, experienced frequent attacks - orchard sabotage being among the most common. In Sivan 5696 (June 1936), a public appeal was issued in the press, calling for assistance and urging the settlement institutions to expand Kfar Yavetz to 60 families and accelerate the settlement effort.
The security situation deteriorated to such an extent that British military and police reinforcements were stationed in the village to ensure its defense. Nevertheless, during this period, some settlers abandoned the community, leaving behind only 13 remaining families.
During the War of Independence (1948), Kfar Yavetz was evacuated. It was resettled in 1951.