The first settlements in the area were two forts built in 1856 during the
Puget Sound War to protect future settlers against possible uprisings by the native population. Fort Patterson, a few miles downstream, and Fort Tilton, a few miles upstream, were built with the help of Indians led by Chief
Patkanim, and both were abandoned within two years after interactions with the local tribes remained peaceful. A historical marker can be found north of Fall City on Fish Hatchery Road where Fort Tilton once stood. A trading post was established near the present-day location of the Last Frontier Saloon in 1869 and became a hub of the local economy. Fall City was known at the time as "The Landing", as shallow water and rapids upstream on the Snoqualmie were impassable to the large
dugout canoes used to transport goods. In the early 1870s, the first local mill in the
Snoqualmie Valley was opened at the mouth of Tokul Creek, just downstream from
Snoqualmie Falls and just upstream from where Fall City would be. The Fall City post office opened June 10, 1872. Small steamboats started ferrying supplies up the river in 1875. In the late 1880s, a group of Puget Sound businessmen founded and started building the
Seattle, Lake Shore and Eastern Railway, including a line up into the upper Snoqualmie Valley, in an attempt to build a line over the
Cascade Range. The land claim holder at the time,
Jeremiah "Jerry" Borst, had Fall City surveyed and platted in anticipation of the people the railroad would bring, but was disappointed in 1889 when the railroad line was built a mile (1.6 km) away from the community. But even a mile away, the railroad, combined with the first bridge over the Snoqualmie River, greatly improved the local lumber mills' and farmers' business, and made the area and its scenic features (such as
Snoqualmie Falls) accessible to tourists. Hundreds moved to the area over the next two decades. When the
Sunset Highway connecting Seattle with
Eastern Washington through Fall City was improved in the early 1910s, it further accelerated the area's economic and residential development. By the late 1920s, most of the population either worked in the burgeoning tourist trade or commuted to work west toward
Issaquah and
Seattle. The
Great Depression, followed by gasoline rationing during
World War II, hurt Fall City's tourist trade. Tourism was further hampered after the war as
U.S. Highway 10 (now
Interstate 90) was rerouted south directly from
Preston to
North Bend, bypassing Fall City and Snoqualmie. The local economy suffered further as local logging mills started closing. Fall City is a
bedroom community to the high-tech industry of the
Seattle metropolitan area, with large suburban estates just outside the community juxtaposed with the historical homes and farmsteads built in its heyday. ==Geography==