Between the end of the Civil War until the beginning of World War I, modern Texas began taking shape with the development of railroads and industry. Rail lines made Texas a part of the nation's economy. Oil production and refining, with the 1901 Spindletop oilfield discovery near Beaumont, joined agriculture as one of Texas' important economic activities. During the early part of this century, the Hays County region was still mostly agricultural, but it was tied more to the commercial crops and livestock economics of the United States.
It was Southern in outlook, with a good-sized African-American population, but with an increasingly Mexican-American workforce for agricultural labor. Like more of Texas, San Marcos was a rural community but was experiencing growth as an educational and business center. Until the Depression, the Hays County area experienced substantial economic growth.