In 1874, just two years after the road over the Cascade Mountains opened, hundreds of Indians arrived at their traditional camp site in the meadows along Whychus Creek to find three families who had come over the Santiam Pass from the Willamette Valley. For generations each autumn, on the grassy flats where Whychus comes out of the mountains, Indians had camped before returning to their winter homes to the north. The Indian camps of 1874 surrounded the camps of Mr. and Mrs. J.B. Claypool and two other families. The Claypools were among the first families that settled on Squaw Flats, northeast of what is now Sisters. By the mid-1880s about 20 families had settled near the site of Sisters, where two main routes over the Cascades met. The site was on the 1879 AJ Warrin Road from the Santiam and the McKenzie Pass routes.

In the late 1800s, ranchers in the Willamette Valley sought grass for cattle and sheep, driving the effort to improve trails over the mountains. As routes improved, more people made the journey to Central Oregon. In the 1880s and 1890s Sisters was a stopping place for sheepherders preparing for the mountain crossing to the winter ranges in the Willamette Valley. People looking for homesteading land found plenty of open meadowland in the valleys of Whychus and Indian Ford creeks. Claypool’s son, David, homesteaded along Indian Ford Creek on what is now Indian Ford Ranch Co., and the Graham family homesteaded in the meadows of what is now the Glaze Meadow section of Black Butte Ranch. In 1888, the Camp Polk post office moved to be closer to the center of activity and the US Postal Department gave the name of Sisters to the settlement. By 1904 Sisters boasted two stores, a hotel, a blacksmith’s, a saloon, a real estate office, a livery, a school, and a lumber mill. One store had a dance hall. As the only town between the west side of the Cascades and Prineville, Sisters appeared to be on its way to becoming a hub for the high desert.

A decade later, the timber industry and real estate were booming in Sisters. Mills sprouted up in the surrounding forests. Tragedy struck Sisters in 1923 and 1924 when two fires raged through the town, destroying businesses and many of the old buildings. The first fire ignited while the men were away to a big track meet in Redmond. The few people left carried water 200 yards from Whychus Creek to fight the blaze until people from Bend and Redmond came to help. The second fire, 16 months later, burned most of the remaining historic buildings. The Farthing House and the Hardy Allen House remained untouched, and fire fighters saved the Sisters Hotel although both fires scorched it. These are some of the few remaining pre-fire buildings in Sisters today.

Throughout the mid-twentieth century, Sisters continued to grow and change. Residents supported community and cultural events. Bucking contests held as early as 1910 brought cowboys from other areas. Other rodeo events were took place until in 1943 the first annual Sisters Rodeo was held. The purses were high, earning the rodeo the name “biggest little show in the world.”

Basketball, track and field, and football were big sports events in Central Oregon and Sisters participated. The name of the school athletic team “Sisters Outlaws” stems from the days when the town was a dusty lumber and cow town. The town held an annual fair from 1914 until 1918 when WWI dampened the effort. In the early 1930s the high school presented a music festival and in 1936 started an orchestra.

In 1946 the little mill town incorporated. The lumber industry was vital to the town’s growth but by 1963 the last mill closed. Situated in a beautiful setting, from early on the town held an attraction for tourists and people looking for a mountain community. After a brief period of declining population, in the 1970s the town began growing again. The scenic beauty and nearby destination resorts, such as Black Butte Ranch, attracted people and business to the area. In the 1970s Sisters adopted the 1880s theme to downtown buildings and by the 1980s a new boom was in full swing.