In the town's first decade the open range and great cattle drives ended, and barbed wire fencing divided the prairies into small farms. The 1890's ushered in a period of central Texas growth and change. Railroads attracted settlers and inventions improved life on the farm. Commissioners built farm roads and bridges, resulting in the development of rural communities along mail routes. Franklin became the political, social, and trade center for the eastern half of the county. Families living at Henry Prairie, Owensville, Camp Creek, and like settlements considered the county seat their home town.

Cotton farming, the mainstay of rural life in the Franklin area through the first thirty years of settlement, received a severe economic blow in the early 1920's. Prices dropped from forty cents per pound of cotton to less than six cents in a period of months. Merchants lost their holdings, and banks, having loaned money on anticipated high prices became insolvent. The economic depression reduced merchants and farmers alike. Their struggle back to solvency required years and the full cooperation of the business and farm community.

Some of the cotton farmers in the area were W. W. Smith, Frank Carter, Dee Smith, J. B. Seigler, John Brooker, O. P. Sandifer, J. J. Marshall, A. Mauk, Buck Gilstrap, D. M. Reagan, Hugh McMillan, W. W. Sandifer, W. F. Grant, C. P. Haygood, J. R. Gilstrap, P. C. Reagan, Dan Morris, W. E. Bishop, R. M. Tynes, R. W. Cole, George Brown, Richard Hicks, D. D. Bishop and others.

Some of the early business establishments in Franklin included Easter and Kellogg, R. S. Glass and Son, Wyser and Calvert, Bartholomew and Brown, McMillan and Maris, Mitchell Brothers, The Franklin Furniture and Hardware Store, and others.

In 1881, John, Marsh, Henry and Kate Mitchell moved to Franklin from Wheelock. In partnership with E. A. Decherd, they operated a general merchandise store and a private bank. J. J. Carter, with his young wife, came to Central Texas from Houston in the same year and finally settled where they, with S. J. Maris, operated a lumber company. M. D. Sharp also combined private banking with business and it was not until 1905 the First National Bank of Franklin was chartered. The First State Bank was established in 1913.

At the turn of the century the children's playground at Franklin was the railway depot. There, agents kept cool water and benches for visitors. Young people played on the grounds and adults greeted friends and watched to see what was passing through the country. L. A. Gray and Bill Holder, among the first agents, were popular citizens.

J. C. Mitchell Sr. was the first postmaster in the town. His post office was a railway box car that had been sidetracked by International Railway officials. After a short time, Mitchell resigned his position to devote full time to selling, and Elias Reynolds replaced him.