Terrell developed as a railroad town, beginning in 1873 with construction here of the Texas and Pacific Railroad line. The town was named for Robert A.
Terrell, a pioneer European-American settler whose farm lay on its western edge. He built an octagonal house on his property, called a “Round House”, to provide better defense against attacks by Native Americans. They had occupied this territory for thousands of years. His house was later fitted with the first glass windows in the county.