Cannel City is an unincorporated community in Morgan County, Kentucky, United States.

In 1901, the Ohio and Kentucky railway tracks were laid through the region and thrived until the Cannel Coal Company's resources were depleted and forestry resources of the Licking River played out at the same time.

On November 1, 1933, the last train trip of the Ohio and Kentucky Junction Railroad-Cannel City Line was made and the track was scrapped.

At one time, the area had a larger population and count of buildings than the present-day county seat West Liberty.

After the mine closed, the area still partially thrived during the times after the Great Depression.