Craigie Flour Mill was the first flour and grist mill in Otter Tail County, built by Scottish immigrant James Craigie near this spot in 1870 along Balmoral Creek. During the mill's operation, the creek was dammed into a mill pond to provide power, and the mill became the nucleus of the small settlement of Balmoral, which at various times included the Craigie farmstead and mill, a hotel, a store, resort cottages, and a dance hall. The mill was razed in the 1930s. By the 1920s, as cars became affordable to the middle class, Otter Tail County had become a popular recreational destination because of its lakes, woods, and rolling hills, and summer tourist traffic led this section of State Highway 78 to be paved in 1937. In the spring of 1939, a historical marker was first erected on this site, accompanied by an original millstone and an iron water wheel from the Craigie Mill, and it was dedicated on June 25, 1939 during a meeting of the Otter Tail County Historical Society attended by more than 2,000 people. By December 1939, the Minnesota Highway Department had approved plans for a more elaborate marker and wayside, built the following year in 1940. The wayside and stone marker were constructed by young men employed by the National Youth Administration, a New Deal work program that helped relieve unemployment during the Great Depression while teaching useful skills, and the site was designed by prominent Minnesota landscape architect Arthur R. Nichols.