Encinal is on Interstate Highway 35 twenty-seven miles south of Cotulla in southwestern La Salle County. Railroad officials reportedly named the spot the Spanish word for "oak grove." Before the International-Great Northern Railroad extended its tracks into the area, a small community called Ancaster already existed near, and possibly on, the site of present Encinal. It has been suggested that Encinal began as a settlement 1½ miles from the present site, which was moved to the railroad tracks when they were laid down in the early 1880s. An 1882 railroad map shows only a stop named Burro in the general location of present Encinal. In 1883, when a post office was granted under the name of Encinal, there were probably no more than two or three frame buildings on the site. But the town developed rather rapidly as a shipping center for sheep and cattle. In 1886 its first school was established, and by 1890 Encinal reportedly had a population of 900 and several businesses, including three general stores and a saloon. By 1896 the community had a school for sixty-one students, four general stores, the saloon, and an insurance agent.
Many of the early residents were of Mexican descent. A Catholic church was built in 1893. In 1908 a Presbyterian church was built; and by that year the town had two public schools, which enrolled 158 students. In 1931 the town had three public schools with a total of 363 students. In 1933 Encinal reported 800 residents and thirteen businesses; similar statistics were reported through the mid-1940s.
In 1947 the population of Encinal was 650, and by 1949 it was only 300; it was so reported until the 1980s. The number of businesses dropped from fourteen in 1949 to seven in 1974. That year the town had one school for its 203 elementary students; junior and senior high school students attended school in Cotulla. Natural gas wells had been discovered in the area by 1974, when businesses included two natural gas pumping stations, five cafes, a general store, and a drugstore, though ranching was still the primary business. In 1980 Encinal had twelve businesses and 300 residents. In 1990 the population was 620 and in 2000 it was 629.