It was determined to organize a town company, which was immediately done, and a constitution was then adopted and officers elected.

The officers of the company after due consideration of different points selected a site for the proposed town, about two miles (3 km) north of Cofachique, at the confluence of Elm Creek and the Neosho River.

Meetings of the company were held every week during the first year and efforts made to induce settlement.

The residents of Cofachique, despairing of making their town a success, joined with Iola, and most of them moved to the new site, all working together in the endeavor to secure the location of the county seat at once.

The first building erected after the town was surveyed was a dwelling completed early in June, 1859, by J.F.

On the completion of the house, Colborn and his family moved into it, thus being the first settlers in the town of Iola.

[8] About 1859 a stone building was built to become the town's headquarters in the event of troubles with Indians or Bushwhackers.

When the Civil War erupted in 1861, the building and the block on which it stood were fortified, becoming Iola's fort.

[9] During 1859, two stores were established by Aaron Case and James Faulkner, who had moved their buildings and goods from the old town of Cofachique, and the first hotel was opened.

People were still dissatisfied, and for several years thereafter the county seat question entered largely into every political campaign.

Much strife and bitterness of feeling was thus engendered between the two sections of the county, and harsh accusations and recriminations were the order of the day.

In the latter part of the year the effects of the drought were so badly felt, in addition to failing to secure the county seat, that business became very dull, and for a time all of the citizens were much discouraged.

But with the monetary panic of 1873, the value of bonds so depreciated that the company failed, and removed its machinery.

They received bonds in payment, generally, for their bridges and work, and for this reason the "crash" ruined them.

The buildings and several acres of land on which they were located were sold at a Sheriff's sale for $1,100, being purchased by several citizens of Iola.

The Allen County Courant was the first newspaper published int Iola, and was established January 5, 1867, by W.H.

On July 27, 1868, Messrs. Talcott & Acers purchased it, and the name of the paper was changed to the Neosho Valley Register.

In the following years the ownership of the paper changed five times and it was briefly renamed Kansas State Register between August 24 and December 10, 1870.

In July, 1866, bonds were voted to help raise the necessary funds, and not long after a building was purchased from George J. Eldridge, and used for county offices and all court house purposes.

In 1877, a new court house, built of stone, was purchased for $1,800, and the old one was sold to the school district to use for a schoolhouse, for $500.

The school was kept in two buildings, one the large two-story stone structure erected in 1868, and having an imposing appearance with its twin towers.

An economic boom from natural gas (discovered December 25, 1893)[12] began around 1895 and resulted in a surge in population and industry.

[13] The climate in this area is characterized by hot, humid summers and generally mild to cool winters.

The origins of this event go back to 1971 when Stanley Dreher, Gary Parker, and Leon Catron began an effort to bring townspeople out to the farm.

Aaron Franklin and his crew now work very hard to make sure that Farm-City Days still has the magic for all townspeople that has existed in this celebration for nearly 50 years.

The 2020 United States census counted 5,396 people, 2,291 households, and 1,254 families in Iola.

The community is served by Iola USD 257 public school district, home of the 2006 Kansas 4A Girls State Basketball Champions.