The city of Denison was founded in 1872 in conjunction with the MKT or "Katy" depot. It was named after the wealthy Katy vice president George Denison. Because the town was established at the intersection of the MKT and the Red River (both important conduits of transportation in the industrial era), it came to be an important commercial center in the 19th century American West.

During the phylloxera epidemic of the mid-1800s, which destroyed the vast majority of wine grapes in Europe, Denison horticulturalist T.V. Munson pioneered methods in creating phylloxera resistant vines, and earned induction into the French Legion of Honor, as well as sister city status for Denison and Cognac, France.

In 1901 the first electric "Interurban" railway in Texas, the Denison and Sherman Railway, was completed between Denison and Sherman, Texas.

Later, Denison played host to 20th century notables such as the Marx Brothers and President Dwight D. Eisenhower, who was born there. Denison was also the home of the Quedlinburgh Treasure, a collection of stolen 9th century religious relics, while they were hidden in a downtown bank vault by a World War II soldier from Whitewright, Texas. The treasures ended their stay in Denison when William H. Honan , of the New York Times, broke the story. They were displayed in the Dallas Museum of Art, then repatriated to Germany.

In the 1990s Denison began attracting artists to its Main Street district.[citation needed] Artists settled into many of the 19th century buildings along Main Street and converted them into art galleries and artists studios.[citation needed] Denison now is home to the work of many artists with local, regional, and national acclaim. The Denison Arts Council [3] promotes two Fine Art Tours each year to showcase the growing talent of the area. Many other historic buildings now house loft living spaces and specialty shops. Denison arts have been featured in Texas Highways Magazine

U.S. President Dwight D. Eisenhower was born in Denison, and is by far the city's most famous resident. His birthplace was purchased by the city in 1946 (six years before he became President) and is now maintained as Eisenhower Birthplace State Historic Site. In addition, Eisenhower State Park on Lake Texoma is also named in his honor.

Other famous people that were either born in or lived in Denison include:

* Thomas Volney Munson, horticulturalist
* Chesley Burnett "Sully" Sullenberger, airline pilot[
* Professional football players, and brothers Aaron Hunt and Reggie Hunt play in the Canadian Football League.
* George McFarland, an actor, appeared as Spanky in 95 Our Gang films between 1932 and 1942.
* Actor John Hillerman.
* Author and commentator Jim Hightower

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