In 1841, the Republic of Texas chartered the Peters Colony Land Grant Company (named for William Smalling Peters, publisher of the song “Oh! Susanna“)^[9] to settle the North Texas area.^[10] In 1844, John W. King and his wife settled on the east side of the prairie, where the city now lies. Baptist settlers from Platte County, Missouri, settled on the west side; among them were John and James Holford, who named the area Holford’s Prairie.^[11][12] Further south, Presbyterians established a church and called it Flower Mound.^[13] In the confusion over land ownership after the Hedgcoxe War, Basdeal Lewis purchased Holford’s Prairie in 1853 and renamed it after himself.^[14]

In 1845, the Fox family, which owned about a dozen slaves, buried a slave child called Melinda on the family farm, which eventually became the town’s cemetery for black residents. Named Fox–Hembry Cemetery, the plot still exists today.^[15] After it had fallen into disrepair, local residents and businesses gathered to restore it in 2011.^[16] Though Abraham Lincoln was not on the ballot in the area for the 1860 Presidential election, residents of Lewisville (listed as “Hollforts” on election results) still gave John C. Breckinridge only a 44–31 majority over an electoral fusion option.^[17]

During Reconstruction, Lewisville became home to Denton County’s first cotton gin. Built in 1867, it could produce up to three bales per day.^[18][19] The Thirteenth Texas Legislature chartered the Dallas and Wichita Railroad (later the Missouri–Kansas–Texas) on terms requiring 20 miles of track to be in running order by July 1, 1875. Lewisville paid the company $15,000 to come to the city, with a promise of another $5,000 on completion.^[20] The company fulfilled the deal by completing the railroad tracks to a point just south of Lewisville on the morning of the deadline, and the line began running full-time in 1881.^[21][10] Republicans in the Fourteenth Texas Legislature passed a law on April 30, 1874, prohibiting alcohol within two miles of the town.^[22] Many residents ignored the law, however, and the city retained as many as 17 saloons at one point.^[23] The population of the unincorporated town was 500 in 1888.^[24]