Gatesville, the county seat of Coryell County, is on the Leon River at the intersection of U.S. Highway 84 and State Highway 36, eighty miles north of Austin in the central part of the county. It was established on land donated by Richard G. Grant shortly after the county was organized in 1854 and took its name from nearby Fort Gates. James C. Newton became the first postmaster when the post office was established in July of that year. Gatesville was fairly isolated during the early years of its existence. Supplies had to be brought by wagon from Houston, 200 miles away. The town grew slowly in the late 1850s and little, if any, during the Civil War. Afterward, however, the town profited from the large influx of settlers moving to Texas to build new lives. In 1870 Gatesville was incorporated with a mayoral form of government; by 1880 its population had risen to 434, and it had become an important frontier supply station.
In the early 1880s residents of Gatesville gave $30,000 and land to the Texas and St. Louis Railway so that rail service could be extended to their town. The Waco-to-Gatesville section of the railroad was completed in 1882, opening Coryell County to outside markets and making Gatesville the county's major shipping and supply center. By 1884 the town had steam grist and saw mills, cotton gins, several assorted businesses, three churches, two schools, and two weekly newspapers to serve an estimated population of 600. By 1890 the population had more than doubled to 1,375. In 1911 the Stephenville North and South Texas completed the section of track between Hamilton and Gatesville. The population rose from 1,929 in 1910 to 2,499 in 1920. Unfortunately, the SN&ST encountered financial difficulties and declared bankruptcy in the mid-1930s; the track was abandoned in 1942.
The Gatesville economy benefited from the construction of Fort Hood in the early 1940s, and the town grew steadily. The population rose from 3,177 in 1940 to 3,838 by 1950 and 4,626 by 1960. In spite of its continued growth, Gatesville lost business to Copperas Cove in the 1960s and 1970s. Gatesville maintained its status as county seat, but after the early 1960s it was no longer the county's largest town. In 1972 the St. Louis and Southwestern of Texas abandoned its track between Lime City and Gatesville, leaving Gatesville without rail service.
Two correctional institutions have been located in Gatesville. One, the Gatesville State School for Boys, was established in 1887; the other, the Mountain View School for Boys, was established in 1962. Both facilities became women's units of the Texas Department of Corrections (see PRISON SYSTEM) in the 1970s, and a third unit, called Hilltop, opened in 1981. Local industries in the 1980s included the manufacture of boats, trailers, clothing, and plastic medical products, in addition to farm-related businesses. The population was estimated at 6,931 in 1988. The courthouse was restored in 1988, and the town had a public library. The Alfred D. Hughes Unit, a men's maximum security unit of the Texas Department of Corrections, was opened in 1990, when the city had a population of 11,492. The population was 15,591 in 2000.