Tanglewood is on U.S. Highway 77 five miles northwest of Lexington in northwestern Lee County. The area was first settled in 1856 by the Rev. Hugh Wilson, who founded the String Prairie Presbyterian Church there. After the Civil War a small settlement began to develop around the church. The town is said to have been named by two sisters who were reading a book called Tanglewood Tales. A post office was opened there in 1880, and by 1884 Tanglewood had three churches, a public school, a steam gristmill and cotton gin, and a general store. The business district was originally a mile east of its present site. When the San Antonio and Aransas Pass Railway was built in the early 1890s it bypassed the town, so Tanglewood residents decided to move closer to the tracks. A new townsite was platted in 1894, and most of the structures were moved to the new location. Reverend Wilson's church was drawn by mules on large log rollers to its new site. After 1900 three general stores, three cotton mills, and a broom factory owned by Henry Kelley were in operation, and during the 1905–06 school year the public school enrolled forty-two students. In 1914 the population of Tanglewood was estimated at 100, but after the early 1920s the town began to decline. Membership in the Presbyterian church dropped, the church was dissolved in 1922, and its congregation moved to Dime Box. The population of Tanglewood was reported at seventy-five in 1925 but dropped to forty by the early 1950s, when the town had two businesses. In 1950 the school was consolidated with the Lexington Independent School District. The population of Tanglewood was estimated at forty-eight in the early 1970s, and at that time the community had a general store, an antique shop, a real estate office, and a Baptist church. The population was still reported as forty-eight through 2000.