In 1858, Sabine County organized the community of Hemphill, named for Texas Supreme Court Justice John Hemphill (1803 - 1862). An election determined that the county seat would be moved from Milam to this new settlement in the center of Sabine County. Early Percy Beddoe surveyed and laid out the town site on an 80-acre tract owned by Richard Fendall Slaughter and his wife, Anna (Holman). A post office was established in Hemphill in 1859.
Builders constructed the first courthouse in Hemphill shortly after the community's establishment; it was replaced in 1864 by another building, which burned down in 1875. Builders completed another courthouse in 1877, which was eventually replaced by the current structure in 1906. Other significant early institutions included Sabine Valley University, established in 1879, First National Bank, which opened in 1907 and closed during the Great Depression. Hemphill Common School District No. 1 organized in the late 1800s, and by 1890 listed three trustees, two teachers and eighty-eight students.
The population of Hemphill increased steadily between 1850 and 1930, due in great part to the presence of the Knox Sawmill in the western portion of town. Temple Lumber Company later bought the mill, which burned I n1937. Combined with post-World War II rural-to-urban migration trends and
the lack of major thoroughfares in the town, the closing of the sawmill promoted a decline in the community's population. Today, Hemphill remains the seat of the Sabine County government, and is home to several national, state, and local offices, remaining a community of vital importance in the state of Texas.