In the early years Two Harbors consisted of two separate communities, Agate Bay and Burlington.

Diets often consisted of homegrown vegetables and animals caught in the area (at that time there were many dense forests, so deer meat was not an abundant food source).

The village of Agate Bay was created with the construction camp as work on the new railroad began in 1883.

Early transportation to the village was by boats under contract with the new Duluth and Iron Range Railroad, and by horse.

By 1886 the D&IR completed the Lake Division connecting Duluth and Two Harbors with passenger service that extended to Ely.

By 1883 the Minnesota Iron Company had purchased all but four acres of Thomas Sexton's land around Agate Bay.

Sexton leased his remaining four acres to merchants seeking to capitalize on the 600-man workforce arriving to build the Duluth & Iron Range Railroad.

The infamous four-acre plot earned the nickname "Whiskey Row", and was said to exist for the sole purpose of "relieving a man from his pay".

The railroad rapidly expanded its rail and shipping operations and needed all of the shoreline for its new coal handling and storage facility.

By 1885 the Minnesota Iron Company convinced Sexton to sell his remaining four acres along Agate Bay.

This proved difficult when heavy loads such as railroad engines nearly sank the scows or tugs that carried them.

On that day, the first iron ore cars left Agate Bay early in the morning, along with a caboose for President Tower to ride in on the return trip.

The North Shore Scenic Railroad operates a six-hour excursion starting in Duluth that has a two-hour break in Two Harbors.

A 2-6-0 Mogul class steam locomotive with the first style of ore cars and caboose is on display by the historic Duluth and Iron Range depot.

In 2022, incumbent mayor Chris Swanson was recalled; over 86% of voters voted to remove him after a series of controversies.

City Council President Ben Redden has taken over the mayor's duties pending a special election to choose a replacement.

[7][8] According to the United States Census Bureau, the city has a total area of 3.30 square miles (8.55 km2), all land.

[citation needed] In 1900, John H. Kallin built Two Harbors Cigar Factory on the 100 block of 7th Street.

Producing three wheel mailsters for the United States Postal Service was their main contract, worth millions.

It offered flavors of pop such as cream soda, ginger ale, cider, and seltzer water.

When the founders thought they had found mineral called corundum, which could be used to make sandpaper, they began setting up a mining company.

The five were Henry S. Bryan, J. Danley Budd, Herman Cable, William McGonagle, and John Dwan.

To get the company started they erected a large dock, crushing mill and bunk and storage houses.

Exhibits include Dwan's recreated office and other artifacts; a history of the company including photos and documents; a "lab" area representing the establishment of research and development, product diversification and growth; and hands-on interactive programs and technology applications.

The Edna G. stayed in Two Harbors its entire working career except for a small stint during World War I it spent two years on the east coast moving warships around.

A trip includes a visit to the engine room, and seeing the pilot house, where the passengers are allowed to blow the horn.

Mok-qua Bennete, also known as John Beargrease, was an Ojibwe man who delivered mail between Two Harbors and Grand Marais.

The John Beargrease Dog Sled Race was started as a tribute to him for his role in the early history of the North Shore of Lake Superior.

The Two Harbors area is host to numerous outdoor events each year, including the challenging Heck of the North gravel bike race.

A referendum for a new building two miles (3 km) north of town on Lake County Highway 2 (CR 2) was passed in 2003.