Moody traces its history to the pre-Civil War settlement of Perry, two miles north. In 1881, the Gulf, Colorado and Santa Fe Railroad bypassed Perry, and a new town was platted on the land of early settler William Naler. Colonel W.L. Moody of Galveston, who supervised the laying of track in the area, named the town in honor of his family. Incorporated in 1901, Moody has thrived over the years and has been home to various fraternal, educational, commercial, religious, and medical institutions and organizations.