In 1900, it was named in honor of local businessman Harrison Phoebus (1840–1886), who is credited with convincing the Chesapeake and Ohio Railway (C&O) to extend its tracks to the town from Newport News.

Captain John Smith landed on a part of Phoebus known as Strawberry Banks on his first voyage up the James River in 1607.

The area which became the Town of Phoebus was founded in 1609 as Mill Creek; it was located on the banks of the Chesapeake Bay and Hampton Roads, directly across from Norfolk's Willoughby Spit.

English colonists soon built defensive fortifications at Old Point Comfort to protect the entrance to Hampton Roads.

[3] During the American Civil War, numerous slaves escaped to Fort Monroe and Norfolk, which was occupied by Union forces from 1861.

Officials contacted a respected local teacher, Mary S. Peake, and asked her to teach the freedmen and their children.

The American Missionary Association (AMA), whose leaders included both black and white ministers, hired her to teach and arranged for her to use the Brown Cottage.

From the main line at Old Point Junction, tracks were extended easterly a distance of about 10 miles (16 km) toward Fort Monroe.

During the first half of the 20th century, excursion trains were operated to reach nearby Buckroe Beach, where an amusement park was among the attractions that brought church groups and vacationers.