It was considered a safe backwoods place during Prohibition when the likes of Clyde Barrow and Bonnie Parker hung out in the area.

Not long after Cedar Creek Lake (a reservoir for the Tarrant Regional Water District) completed construction, the fledgling community that sat on its banks took steps to officially become a town.

[citation needed] In May 2000, Gun Barrel City voters elected their 13th mayor, 21-year-old entrepreneur and newspaper publisher Randal Tye Thomas.

He resigned after community outcry in May 2001 following a grand jury indictment for one count of misdemeanor perjury[5] and in the same week being arrested by the Gun Barrel City Police Department for public intoxication.

In 2008, Gun Barrel City received the coveted Certified Retirement Community recognition from the Texas Department of Agriculture's Go Texan program.

[8] Gun Barrel City is located in northwestern Henderson County, on the eastern shore of Cedar Creek Lake, part of the Trinity River watershed.

Texas State Highway 334 runs through the center of town, leading west to Seven Points and east to U.S. Route 175 between Mabank and Eustace.

Athens, the Henderson county seat, is 18 miles (29 km) southeast of Gun Barrel City via US 175.

[4] Nestled on the shores of Cedar Creek Lake, 55 miles (89 km) southeast of downtown Dallas, Gun Barrel City is the retail hub for a trade area of more than 75,000 people and features no town property tax.

With a seven-member board and one staff person, the Gun Barrel City EDC is funded by a $.0025 sales tax.

They evaluate incentives for businesses to locate or expand in the Gun Barrel City area and base their findings on taxes assessed and paid, the number of jobs created or retained, wages paid, local purchases of products and services, indirect employment gains, and the general benefit of furthering the mission of the Gun Barrel City EDC.

Funds may be used in land lease/purchase, building lease/purchase, rehabilitation or construction, capital equipment purchase, infrastructure improvements or employee training.