Mound Prairie was eight miles north of Palestine at a site one mile west of present highway 155 in Anderson County. Some of the earliest settlers moved there from Georgia in 1830 or 1832. Among them were the Wright, the Lumpkin, and the McDonald families. Other early settlers included Dr. George Lester and Joseph Pinson. The name Mound Prairie probably came from an Indian mound near Mound Prairie Creek. The area had good farmland, and the little town grew quickly. By the late 1850s and early 1860s it had Methodist and Baptist churches, the Mound Prairie Institute, a newspaper, a gun factory, and a blacksmith shop. During the Civil War iron products such as guns, iron singletrees, and ploughs were made in the foundry operated by John Billups and D. D. Hassell. A mill in the town manufactured cotton and woolen cloth. In 1861 the head of the Mound Prairie Institute was thought to be a northern sympathizer, and the academy was closed. Some of the settlers moved below what is now Neches and built a school. With the coming of the railroad in 1872, many of the remaining townspeople moved to Palestine, and Mound Prairie dwindled away. In the early 1920s only two buildings remained-an old store and a structure that had once been a fine home. During the early 1990s all that was left at the site was the Mound Prairie Cemetery.