[2] Post-Civil War railroad construction lured heavy industry to the Second Creek valley, starting with the Knoxville Iron Company, which built a massive foundry just southeast of Mechanicsville in 1868.

Railroad tracks (now used by the Southern Railway), which also attracted industry to the area, pass just south and east of Mechanicsville, running roughly parallel to I-40 and I-275.

[5] Several Confederate batteries, which provided part of the artillery barrage during the Battle of Fort Sanders, were situated in the hills where Knoxville College is now located.

[5][6] In 2006, amateur Civil War historian Gary Goodson announced that he had determined that the Confederate Camp Van Dorn was located in Malcolm Martin Park, just west of Knoxville College, but his hypothesis was received with some skepticism.

[7] The combination of railroad construction and Northern financing led to a post-war economic boom in Knoxville, and it was during this period that dozens of factories were built along Second Creek.

In 1867, 104 Welsh immigrant families were brought to the area from Pennsylvania by the Welsh-born Richards brothers, Joseph and David, to work in a local rolling mill.

[8] The Richards brothers secured a tract of land in what is now Mechanicsville from railroad tycoon Charles McClung McGhee (1828–1907), which was subsequently laid out in lots, and the new settlers began building houses.

Knoxville College, established in 1875 by the United Presbyterian Church, remained the city's primary black institution throughout the first half of the 20th century.

[6] Mechanicsville experienced a decline during the second half of the 20th century as Knoxville's middle class moved from urban areas to suburbs on the city's periphery.

During the same period, a study on the blighting conditions in the neighborhood was conducted, culminating in the report, "A Redevelopment Plan for Historic Mechanicsville, Knoxville, Tennessee.

Some of its Victorian houses exhibit distinctively Italianate and Gothic influences uncommon in nearby neighborhoods such as Fourth and Gill and Old North Knoxville.

The section of Old Mechanicsville along Calloway and Boyd contains Knoxville's largest concentration of early twentieth century shotgun houses.