In 1761, Daniel Boone came through the area that is now Johnson County. There were two early settlements in the area in the late 1760’s and the 1770’s. One settlement was known as “The Trade Gap”, which was a trading post for Indians and traders, in the south east side of the county. This community is now known as Trade. The other early settlement was on Roane Creek, near the confluence with the Watauga River. Other settlements were made soon after further up Roane Creek and on Little Doe.

The organization of Johnson County took place in 1836 and was named for Thomas Johnson, a leading citizen of Carter County and an early settler on the Doe River. Johnson County was created from parts of Carter County, because of the long distance to travel to the county seat in Elizabethton. The first session of the county court was begun and held at the Pleasant Grove School House on May 2, 1836. In October of 1836, the county commissioners were given authority to contract for the building of a court house. It took about a year to complete the structure. Two years later the jail was completed.

In 1836, the county seat was originally named Taylorsville in honor of Colonel James Taylor. The name was changed to Mountain City in the 1885, to reflect it being in one of the highest valleys in Tennessee. Because the county was so remote, the railroads did not reach the area until the early 1900’s. The arrival of the railroads greatly influenced the development of the timber and manganese mining industries.