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Originally home to Creek and Choctaw Indians, Whatley was first settled by pioneers about 1808. Some of the most famous events in Clarke County's history happened in or near Whatley. A Creek War battle occurred here in 1812 at Fort Sinquefield, the location of an early fort built by settlers for protection against the Creeks who were British allies during the War of 1812. Also nearby is the Old Line Road (Co. Rd. 35) that follows near the surveyed "Indian Boundary Line" which separated the Creek from the Choctaw. Clarke County's revered historian, the Rev. T. H. Ball, is buried in Whatley. One of the earliest churches in the area was Horeb Baptist Church, founded September 9, 1825. The town was first called Horeb in honor of this church. Eventually, the town was named "Whatley", in honor of Franklin Benjamin Whatley (October 1, 1826-June 8, 1896). Mr. Whatley was the grandson of Elder Willis Whatley, an early Baptist minister of Clarke County.
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When the Mobile and Birmingham Railroad came through the county in 1886-87, land on which the depot was built was deeded to the railroad by Mr. F. B. Whatley. The railroad, in turn, honored Mr. Whatley by naming the depot
in his honor. The post office officially changed its name from Horeb to Whatley on August 20, 1890. Following the coming of the railroad and in the first part of the 20th century, Whatley was the trading and shipping center for the large, prosperous farming community. Several mercantile businesses sprang up around the depot. Mrs. Nancy Whatley operated a hotel in the business area and her daughter, Mrs. David Coleman, was proprietor of the hotel for many years.