Bandera is on State Highway 16 fifty miles northwest of San Antonio in east central Bandera County. A townsite plat for the settlement, designated county seat at the formation of Bandera County in 1856, was filed with the first county commissioners' court that year by John James, Charles DeMontel, and John Herndon. The site, on a cypress-lined bend of the Medina River, had been occupied by Indians, then by White campers making shingles. The town and county were named for nearby Bandera Pass. The founders formed a partnership in 1853 to build a town and water-powered lumber mill. They recruited immigrant workers from Upper Silesia by way of the Polish colony in Karnes County (see POLES). These workers arrived in 1855, and each family received purchase rights to town lots and farmland.
The presence of the United States Cavalry at Camp Verde after 1856 encouraged increased activity and settlement. Bandera served the needs of the military and of settlers who took up small holdings in the area. After the Civil War the town boomed as a staging area for cattle drives up the Western Trail. Farm boys became cowboys. Ranchers built holding pens and signed on as trail bosses. Storekeepers contracted as outfitters. Cotton was a commercial crop during this period. An ornate courthouse begun in 1890 announced prosperity from the town square. For local stockraisers, sheep and goats proved more profitable on the shallow limestone soil than cattle, but not until 1920 did the Bandera County Ranchers and Farmers Association organize cooperative storage and marketing of wool and mohair (see WOOL AND MOHAIR INDUSTRY).
The local economy declined after 1900; a series of floods destroyed sawmills, gins, and businesses, and the cattle drives ceased. Until the San Antonio highway was constructed in 1936 Bandera remained relatively inaccessible. Other roads remained unpaved as late as the 1950s.
In 1920 Cora and Ed Buck began taking summer boarders at their ranch on Julian Creek. Other families soon advertised for guests, and by the 1930s Bandera had become well known as a resort offering riverside camps, restaurants, dance halls, and rodeos to complement surrounding dude ranches.
Bandera was incorporated in 1964. A Medina River flood in 1978 caused heavy loss of life and property and emphasized the necessity for strict control of the floodplain. In 1988 state and city officials joined in proposing that most of the floodplain within the city be made open parkland. Although Bandera County's population almost doubled after 1970, the population of Bandera has varied little; it has remained in the range of 1,000 since 1928. In 1988 the town had a population of 1,012 and seventy rated businesses, including crafts stores, medical and veterinary clinics, a sawmill, a weekly newspaper, the county library, seven churches, and the Frontier Times Museum. Bandera offers opportunities for tourism, camping, horse racing, and dude ranching. The population was 877 in 1990 and grew to 957 in 2000.