The railroad built the Town of Spencer, just as the people who worked in Spencer helped build the railroad. That was Southern Railway, which is the Norfolk Southern of today. During its peak in the 1940s, as many as 3,000 people were employed at The Shops. It was the largest employer in the area.

Samuel Spencer, the first President of Southern Railway, established the mechanical shops here in 1896, the midway point of the railroad’s mainline between Washington, DC, and Atlanta, GA. The town is named for him. The Spencer Shops site is listed on the National Register of Historic Places as the largest industrial steam locomotive repair facility in the Southeast following the Civil War. By 1932, the Shops performed daily light repairs on 75 steam locomotives and turned out a completely rebuilt locomotive each day.

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The town was established in 1905 as the huge Shops project was under construction. The railroad partitioned 85 acres into 500 lots for housing, selling the lots for $100 each to workers, instead of creating the traditional “company” town, where the company owned housing and rented it to employees. The deed contained restrictive covenants which maintained that a dwelling costing more than $400 and approved by a company architect would be built on the lot within one year. Other lots were donated for churches, and the company helped establish a park and YMCA. Spencer Shops officially closed July 30, 1960, with the construction of Linwood Yard, referred to as a hump station for building trains, located in nearby Davidson County. Spencer is mentioned in the song, “The Wreck of the Old 97,” as the end point of a train trip which the train never reached.

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With The Shops vacant, local preservationists and legislators acted to preserve the buildings, including the unique roundhouse, as a transportation museum. A feasibility study resulted in the railway president L. Stanley Crane presenting a deed of nearly four acres of the site as a gift to the people of North Carolina. The North Carolina Transportation History Corporation was chartered in 1977 to assist in fund-raising and the acquisition and restoration of artifacts. In 1979, Norfolk Southern donated another five acres to the state-owned museum. Retired railroad employees volunteer their time restoring and maintaining equipment.

Today, nearly 160,000 tourists visit the museum each year, the well-constructed houses are part of a Historic District.

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