As of the census of 2000, there were 3,755 people, 1,425 households, and 1,107 families residing in the town. The population density was . There were 1,608 housing units at an average density of . The racial makeup of the town was 98.91% White, 0.11% African American, 0.03% Native American, 0.53% Asian, 0.08% from other races, and 0.35% from two or more races. Hispanic or Latino of any race were 0.32% of the population.

There were 1,425 households, out of which 34.7% had children under the age of 18 living with them, 68.7% were married couples living together, 6.3% had a female householder with no husband present, and 22.3% were non-families. 19.2% of all households were made up of individuals, and 10.7% had someone living alone who was 65 years of age or older. The average household size was 2.63 and the average family size was 3.01.

In the town, the population was spread out, with 25.7% under the age of 18, 5.1% from 18 to 24, 26.2% from 25 to 44, 26.8% from 45 to 64, and 16.2% who were 65 years of age or older. The median age was 41 years. For every 100 females, there were 96.6 males. For every 100 females age 18 and over, there were 92.2 males.

The median income for a household in the town was $52,544, and the median income for a family was $60,978. Males had a median income of $40,943 versus $27,500 for females. The per capita income for the town was $23,922. About 2.1% of families and 4.5% of the population were below the poverty line, including 4.6% of those under age 18 and 3.6% of those age 65 or over.

Communities and locations in Owasco

  • Baptist Corners – A hamlet in the northeastern part of the town.
  • Burtis Point – A projection into Owasco Lake.
  • Degroff – A hamlet in the northwestern part of the town.
  • Highland Beach – A hamlet on the shore of Lake Owasco and NY-38A.
  • Koenigs Point – A location on Owasco Lake at the southwestern corner of the town.
  • Melrose Park – A suburban area south of Auburn on NY-38A.
  • Owasco – The hamlet of Owasco is in the southeastern part of the town on NY-38A. The Owasco Reformed Church was listed on the National Register of Historic Places in 2010.