Dwight contains an original stretch of U.S. Route 66, and from 1892 until 2016 continuously used a railroad station designed in 1891 by Henry Ives Cobb.

It extends north into southern Grundy County to include the commercial area near the northern exit with Interstate 55.

[5] Dwight was laid out on January 30, 1854, by Richard Price Morgan Jr. (1828-1910), James C. Spencer (1828 – after 1890), and John Lathrop (1809 – 1870).

[9] Lathrop was a civil engineer with a long history of working with canals and railroads in New York; he would soon return to Buffalo.

The Fell brothers were Bloomington land developers who had been active in helping found many central Illinois towns including Clinton, Normal, Pontiac, and Towanda.

They were employed by the railroad as land agents; the Fells had a role in persuading Abraham Lincoln to write his autobiography.

[14] When the surveyors, working for the railroad's chief engineer, Oliver H. Lee, reached the proposed location of the town in 1853, the speculators found that the tracks would pass slightly east of the planned central point and would go through lands in Morgan's area.

[15] To announce to the public that a town would be located here, a tin pan was placed on top of a telegraph pole.

[18] The first passenger train reached Dwight on July 4, 1854, and regular traffic on the railroad began in August of that year.

The first store was a two-story building put up by David McWilliams in 1855 and painted white to attract customers.

The first item sold was a pattern for a "lawn dress" that one of the workmen purchased for the wife of the station master.

Such depot grounds were common in towns of the 1850s and may still be found at Gridley, Chatsworth, Odell, Towanda, McLean and many other central Illinois places.

Morgan had deeded the central 100-foot (30 m) band to the Chicago and Mississippi, but he never turned over the remainder of the depot grounds to the railroad.

Unlike Odell, where the entire original town was aligned with the railroad, only the small central part of the original town of Dwight paralleled the tracks, with West Street running diagonally on the northwest side of the railroad and East Street on the south side.

The visit was important enough that local people recorded the exact time the prince arrived: twenty-seven minutes after six in the afternoon on Saturday, September 22, 1860.

Soon after the Crown Prince arrived he began hunting and over several days the royal party killed over 200 prairie chickens and quail.

[22] In 1878 the grounds of the house where the prince stayed were improved by the American landscape architect Ossian Cole Simonds and in the 21st century were given to the town and have become Renfrew Park.

In 1879 Dwight physician, Dr. Leslie Keeley, working with Richard Oughton, announced that he had found a cure for alcoholism based on gold chloride.

[26] Profits paid for the John R. Oughton House, on the south side of Dwight, which was constructed in 1891 and added to the National Register of Historic Places in 1980. in 1881, the Illinois, Indiana and Iowa Railroad was built east to west through the town from South Bend, Indiana, to Streator, giving it a second railroad station.

The result was a splendid Richardsonian Romanesque edifice, which in 1982 was added to the National Register of Historic Places as the Dwight Railroad Station.

This was intended as part of a fast electric passenger interurban service from Chicago to St. Louis, but no further construction was done.

In 1930 the state of Illinois established the Oakdale Reformatory for Women, which later became the Dwight Correctional Center, west of the village.

Hospital, and an addition opened on May 11, 1947, with a modern surgical suite, wards, clinic, and physical therapy facilities.