Mineral Wells is at the junction of U.S. highways 180 and 281 and on the Weatherford, Mineral Wells and Northwestern Railway in east central Palo Pinto County. The site was settled in 1877 by J. A. Lynch, who laid out the town in 1881. In 1882 a stage line operated between Mineral Wells and Millsap, the terminus of the Texas and Pacific Railway. The local wellwater became famous for its medicinal qualities after Lynch dug the first well and cured his rheumatism with the foul-tasting water. The town boomed as a health resort after 1885, when the Crazy Well was dug. Crazy Water, said to be a sure cure for numerous disorders including hysteria and other mental problems, was bottled and shipped throughout the country. People flocked to Mineral Wells to drink its waters and bathe in specially constructed bathhouses. J. C. Son, founder of the Palo Pinto Star, wrote articles extolling the water in exchange for one of Lynch's town lots. The railroad reached Mineral Wells in 1891, and the first of several resort hotels, the Hexagon House, was built in 1897.
By 1920 the town had 400 mineral wells and was billed as "the South's greatest health resort." Many visitors were attracted each June to the Texas Health Festival. The population was 577 in 1890, 2,048 in 1900, 7,890 in 1920, 6,303 in 1940, 11,053 in 1960, 18,411 in 1970, and 14,468 in 1980. In the decades between 1940 and 1970, population figures reflected the military presence at Camp Wolters (see FORT WOLTERS MILITARY RESERVATION). In 1966 Mineral Wells had 365 businesses, including thirty-five manufacturers, thirty-seven churches, two newspapers, a hospital, a radio station, and a business college. In 1990 it had a population of 14,870 and 304 businesses. The population grew to 16,946 in 2000 with 839 businesses. Although the town remained a center for retirement, health, and recreation, it also had a healthy industrial base in the manufacturing of clay pipe, aircraft systems, plastics, electronic products, bricks, feeds, clothing, and other products. An extension of Weatherford College is located in Mineral Wells. In 1985 Shadows on the Wall, a movie, was filmed at the local Baker Hotel.