Thomas Bean, a wealthy Bonham landowner and surveyor, donated fifty acres of land in southeast Grayson County for a branch railroad line from Sherman to Commerce. Bean died in 1887, and that same year the city of Tom Bean was established. Nearby Whitemound, bypassed by the railroad, lost its post office to Tom Bean in 1888, and many Whitemound settlers moved to the new town. In the 1890s, Bean's estate began selling town lots around the railroad. The city school moved in 1891 from a one-room structure to a two-story building with an auditorium, and several Christian denominations, including the Church of Christ, Baptist, Presbyterian, and Methodist, established churches there. The city charter was signed in 1897, and Ice B. Reeves became the first mayor. In the early twentieth century, Tom Bean boomed, with a grain company, furniture company, drugstore, newspaper called the Tom Bean Bulletin, saloon, dance hall, movie theater, and the Tom Bean Social Club. Later, rising automobile travel and transport and the decline of cotton as the area's principal crop shifted businesses to the larger cities of Denison and Sherman. Although it never again matched its late nineteenth- and early twentieth-century railroad boomtown years, the community grew again in the 1950s and 1980s and celebrated its centennial in 1987, and Tom Bean continues to thrive.