A great-granddaughter of Mr Murrell, Isobel Allard, of Auckland, was responsible for the reunion.
Descendants travelled from all over the country to attend a Central Otago launch of a book on the family history, titled Murrells of Cromwell, and to give copies to the Old Cromwell group and the town library.
A framed photo of Edward and his wife Mary Ann with their 10 children at the cottage was also presented to Old Cromwell, to be displayed in the building.
The cottage forms part of Cromwell's historic precinct.
Hannah Murrell, of Queenstown, who was at the reunion, is one of the last remaining descendants with the family name.
She has brothers who both have daughters, so the name is unlikely to continue into the next generation.
Edward Murrell was a watch-maker and jeweller and served as Cromwell's mayor from 1899-1905 and from 1909-1913.
He was a borough councillor for 25 years and was also a member of the Cromwell Hospital Board for 20 years.
He retired to Christchurch in 1920 and died in 1925.
Mrs Allard has been researching family history since 1974 and came into contact with Bryan Jackson, of Auckland, who later wrote the family history book.
He was related to the Murrells on his wife's side.
"He went through all the photos and information I'd gathered and said: `Isobel, you've got enough information here to write two books.' I said I was just looking for information on the family and that's how it started."
She unearthed several family "treasures" along the way, including letters by relatives and early photos of the family.
"It's all been very satisfying, seeing it get to this point."
Clocks made by Mr Murrell are in the Cromwell Museum and in one of the town's churches, while some of the family still have pocket watches and jewellery he made.
The family also visited the graves of Edward and Mary Ann in the Cromwell cemetery.
Murrell's cottage is now vacant, but has been used in recent times as the base for a business.
Old Cromwell president Adrian Somerville said it was likely to be back in use again soon, once a lease was finalised.