The first settlers of Lyons came in the summer of 1866. The fertile soil of the Logan Valley, combined with the commercial promise provided by access to the railroad after 1881, assured the life of the town. Incorporated in 1884, the village was named for Waldo Lyon, a prominent citizen upon whose land the plots were laid out. Residents have continued to abide by a provision in Lyon's deed, stipulating that liquor not be sold within the town at risk of forfeit of the property.
The Lyons Roller Mill was erected in 1869. The three-story structure was powered by water from a dam built across Logan Creek just west of the town, and was in operation until 1931.
Many of the buildings of the town are constructed of brick manufactured in a brick yard which began operation in 1878. The swimming pool sits in the depression from which the clay was taken.
One of the finest trotting tracks in the country opened in 1891, just one-fourth mile west of Lyons, named The Kite Track. Famous horses broke world records and won large purses on this kite-shaped race track before hard times ended racing after 1893.