[6] Liberty was settled circa 1797 by Adam Dale, an American Revolutionary War veteran from Maryland who built a mill on Smith Fork Creek.

Properties in the historic district include the Liberty High School, built from limestone quarried in the area, and the Salem Baptist Church and cemetery.

[8] On the evening of March 23, 1889, Liberty was hit by a tornado that uprooted trees and caused extensive damage to homes.

[10] According to the United States Census Bureau, the town has a total area of 1.0 square mile (2.6 km2), all land.

Dr. Wayne T. Robinson has claimed to be the original painter of the Liberty Mule: In early October 1906, I climbed up the face of the Allen Bluff to a ledge and with some coal tar made a flat picture of a character from a famous comic strip of that day.

That was 51 years ago, and even though it has been exposed to the elements and to nearby earth-shaking explosions, erosion has dimmed it very little.

In 2003, Liberty residents became upset that an expansion of U.S. 70 to a four-lane road could threaten the mule painting.

The residents started a letter writing campaign to the Tennessee Department of Transportation.