Carrizozo was founded in 1899 by promoter Charles B. Eddy and his brother John as they built the El Paso and Northeastern railroad from El Paso toward Santa Rosa, with a branch line east to Capitan. In 1905 the Eddy brothers sold the railroad to the Phelps Dodge Company, which renamed it the El Paso and Southwestern. In 1906 developer Ira Wetmore platted Carrizozo, which still looks much like the original plats. Governor William C. McDonald, New Mexico's first elected governor after statehood, owned the Bar W Ranch just north of town, and Carrizozo was built on former Bar W land. As Carrizozo boomed as a bustling new railroad town, White Oaks and Lincoln declined, and in 1913 the county seat was moved from Lincoln to Carrizozo because Carrizozo had a railroad. The town takes its name from the tall red grass called Carrizo by the Spanish that once grew here in abundance, and the mountain to the northeast is called Carrizo Mountain.