The town was named for Jonathan Lane, who was an attorney and president of the Cane Belt Railroad. The completion of the Cane Belt's route from Eagle Lake to a terminus in Wharton County in 1900 was made possible by a bonus from the Missouri-Lincoln Trust Corporation, a St. Louis-based company. Lane City was the name of the terminal. Lane bought 25,000 acres (10,000 ha) in Wharton County in 1901, most likely from Shanghai Pierce, and then sold it to the Missouri-Lincoln Trust Company in 1908 for $600,000. Settlers soon arrived through the Colonial Land Company. In the northern states, a leaflet titled A Trip to the Gulf Coast of Texas was circulated. According to the leaflet, which listed names, acreage, barrels of sold rice, and profit per acre, rice was to be the key to financial success. With a cash down payment of only six dollars and an agreement to grow rice on 75% of the property and give 2/5 of the annual crop as payment for the remainder owed, the land was offered in tracts of 120 acres (49 ha) or more at prices ranging from $35 to $50 per acre. On the Colorado River, a sizable pumping facility and two smaller lift facilities were set up to deliver irrigation water to the farmers. The Bay Prairie Irrigation Company, subsequently known as the Southern Irrigation Company, provided and sold the water. T. W. Lane, Jonathan Lane's brother and president of the London Oil and Gas Company, Beaumont, started overseeing the interests of the Southern Irrigation Company in 1904. The facility claimed to have the biggest pump of its kind in the entire world. The two lift plants were situated three miles apart to serve a 23 mi (37 km) canal system, and the main plant could throw a forty-five-inch stream of water. The Gulf, Colorado and Santa Fe Railway constructed a rail spur to the Colorado River pumping station sometime around 1902; the spur was abandoned before 1940, and a county road was laid down on the rail bed. In the Arnim-Lane mercantile business, a post office with the name Arnim was founded in 1901. However, on February 13, 1911, the name was changed to Lane City. Several grocery and mercantile establishments, Methodist and Baptist churches, a saloon, a lumberyard, a blacksmith shop, a nursery, a two-story brick depot, drugstore, Knights of Pythias lodge, and hotel, and a three-story structure housing rice offices, a mill, and warehouses were all present in Lane City at the height of its prosperity in 1909. Numerous social gatherings were held in Lane City, some of which hosted up to 200 visitors. Everyone was either involved in the rice business or making money off of it. Citrus, peach, and fig trees were supplied for commercial planting by the Gulf Coast Nursery. Farmers were encouraged to run hogs, cattle, and turkeys on the land after the harvest to improve the soil, as signs of land depletion were apparent. The area suffered its final blow in July 1909 when a hurricane stormed in and obliterated the majority of the local buildings in addition to the crops. The $250,000 pumping facility suffered substantial damage, and all of the two-story structures were destroyed. Lane City never bounced back. The Gulf, Colorado, and Santa Fe built a rail offshoot from Lane City to Newgulf and then on to connect with the main line at Thompsons, in Fort Bend County when sulfur was discovered on the Boling Dome. The 1950s and the beginning of the 1980s saw a peak in oil and gas output. The community's Perma-Pom business began producing pom-poms for cheerleaders in 1974; by the early 1990s, it employed between 35 and 45 people year-round and 60 to 70 during the busiest months. The plant is located on the same property as the original sugar mill, which had previously been followed by a rice mill and a cotton gin before it was destroyed by fire. Agriculture remained the principal industry in the region in 1990, but cotton, milo, and corn had supplanted rice as the staple crops. At that time, the Lower Colorado River Authority owned the canal system, which was still in operation. In 1990, the community's post office and convenience store/gas station remained operational. The congregation of the nearby Methodist church decreased, and the 1903-built building was demolished in 1984. Only one Black Baptist church in Lane City was still actively operating in 1990. In 1920, Lane City's population was 150; in 1960, it was 200; and from 1980 to 2000, it was 111.^[2]

On December 2, 1953, an F2 tornado struck Lane City, pushing two farmhouses off their foundations. It caused $2,500 in damages.^[3]

Lane City has a post office with the ZIP code 77453.^[4]

Lane City is situated on Texas State Highway 60 on the Atchison, Topeka and Santa Fe Railway, 10 mi (16 km) southeast of Wharton and 15 mi (24 km) north of Bay City in southeastern Wharton County. It is also three miles east of the Colorado River.^[5]

Lane City had its own school in 1909. In 1948, a school consolidation election failed, but students from Lane City were allowed to attend Wharton High School, as Lane City had no high school teachers. It joined the Wharton Independent School District in 1957.^[2]

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  US Post Office in Lane City