In 1856 the Texas state legislature established Palo Pinto County from lands formerly assigned to Bosque and Navarro counties. The county was organized the next year, with the town of Golconda chosen to be the seat of government. The town was renamed Palo Pinto in 1858. One of the first businesses in the county, an ox treadmill, was established that year.

The character of the local economy also changed during the last decades of the nineteenth century and the first years of the twentieth. Sheep ranching dwindled away. While cattle remained an important locus of production, the number of cattle in Palo Pinto declined by 1910. Meanwhile, crop farming became ever more important, and cotton acreage expanded steadily.

Oil production in the county during the 1910s helped to diversify the local economy. The first test oil well in Palo Pinto County was drilled in 1901, but the boom did not occur until 1915, when the field near the town of Palo Pinto was opened and became "one of the most productive oil fields in the world," according to one historian.
[Excerpted from:  John Leffler, "PALO PINTO COUNTY," Handbook of Texas Online. Published by the Texas State Historical Association.]