Cowarts was first settled in the mid-nineteenth century, at the time under the name Cowart. In the late 1890s, a sawmill opened that eventually would employ around 500 people. In 1889, the Midland Railroad built a spur to the area that allowed timber and other products to be transported to outside markets. When the train depot first opened, a sign painter added an ‘s’ to the town’s name on the depot sign, and the mistake became permanent.
The town’s growth was derailed by two major events. First, the sawmill shut down in 1910, dealing a severe blow to the economy. Then on September 17, 1918, a tornado hit the town, killing nine and injuring many more, and destroying many of the town’s structures. The same tornado killed two people in nearby Webb. The town was incorporated in August 1961, with a population of around 225. A water system was constructed in 1966 with the help of a federal grant.