Settlement of the Yakima Valley began in earnest in 1861 with the arrival of Margaret and Fielding M. Thorp (1822-1894). The confinement of Yakima (later Yakama) Nation peoples to a reservation following the conclusion of the 1855-1858 Yakima Indian Wars and the establishment of Fort Simcoe in 1856, together with the signing of the 1855 Treaty of Yakima, opened the region to settlement.
In 1883, the Northern Pacific Railroad announced that it would bypass Yakima City and build a station four miles northwest of the town. In 1884, the 100 town buildings were moved to the site of the railroad station, and the town became known as North Yakima. On January 27, 1886, it became the seat of Yakima County, which had been established in 1865. In 1918, North Yakima became simply Yakima, and the original Yakima City town site changed its name to Union Gap.
Two stores formed the core of the original Yakima City settlement: the O. D. and George Barker store, established in 1869, and the George Goodwin store, established in 1870. Charles and Joseph Schanno soon opened a third store. It was around these businesses that the town began to grow.