The 250 acres (1.0 km2) were bought for $26,600 and Danville citizens backed the project by contributing $16,123.12 of that total.

Nine years after the new hospital opened its doors to patients it experienced a large scale fire which completely gutted the interior of the administration section, all of the female wards, and part of the male wards.

Reportedly, the fire was said to have originated from an explosion of gas in one of the rooms on the second floor of the female wing.

The hospital received full approval of the Central Inspection Board of the American Psychiatric Association for excellence in patient care.

The patient population showed a steady increase up to November 1955, when the figure reached 2,801.