[citation needed] The community was founded in 1886 by Memphis entrepreneur, Enoch Ensley, as a new industrial city on the outskirts of a rapidly developing Birmingham (then just 15 years old) and directly adjacent to the Pratt coal seam.

In 1898, the Ensley Land Company was reorganized and active industrial development resumed, including the construction of hundreds of small workers' cottages.

Schools, churches, public buildings and stores were rapidly constructed to keep pace with the scores of new mills and plants opening up.

During its heyday between the late 1890s and the Great Depression, Ensley was known for its lively fraternal halls and dance clubs, including Tuxedo Junction at the crossing of the Wylam and Pratt City streetcar lines.

Although the new plant was close enough that workers living in Ensley wouldn't have to relocate, the move did stifle any ongoing development.