The site of modern-day Winnemucca has been important to Nevada since the first explorers traversed the region in the late 1820s. It later became a critical place for early settlers, and marked the point at which the immigrant trail headed south toward the Sierra Nevada passes. Winnemucca became a major distribution point for the Central Pacific Railroad, established itself as the center of commerce in north-central Nevada, and was the site of a major bank robbery that remains controversial to this day.

Peter Skene Ogden, a leading trapper for the Hudson Bay Company, was the first of European descent to arrive in 1828. Some members of the Bartleson-Bidwell party reached the area in 1841, followed by other westbound immigrants who found it to be the most convenient place to cross the Humboldt River. A Frenchman established a trading post there in the early 1850s and the site became known as Frenchman's Ford.

There was some mining activity in nearby mountains in the 1860s, which led settler Joseph Ginacca to begin construction of a ninety-mile canal for transporting ore for processing. The waterway began at Preble, northeast of Golconda, and was designed to flow ninety miles to Mill City. Only a portion of the canal was completed, and it was used for irrigation purposes in Frenchman's Ford.

Frank Baud, one of the town's first founders and Winnemucca's first postmaster, came in 1862 to work on the canal. A year later he built a toll bridge, and in 1867 established the Winnemucca Hotel. He died in 1868, but left $500 in his will to establish Winnemucca's first schoolhouse.

The town began to flourish in 1868, when Charles Crocker of the Central Pacific Railroad deemed it a good place for the railway to intersect with stage lines that ran both north and south. It was about this time that the town was named after Old Winnemucca, a respected Paiute leader. By 1870, a modern town of 290 citizens had emerged, and in 1872 it was designated as the seat of Humboldt County.

The "Winnemucca Bank Robbery" occurred on September 19, 1900, when three men entered the First National Bank and robbed owner George Nixon at gunpoint. The men escaped on horseback, and were never apprehended. For many years, Butch Cassidy was said to have been one of the robbers, but modern historians have debunked the story. Based on Cassidy's known whereabouts at the time, it is unlikely that he was in Winnemucca.

Nixon–who would go on to became a U.S. Senator–financed the construction of the Nixon Opera House in 1907. The large, two-story building was the pride of Winnemucca until a fire destroyed it in 1992.

Microscopic gold was discovered in the Winnemucca area in the late 1970s, and was profitably mined in the 1980s due to a spike in the price of the precious metal. The population of the town exploded, and Winnemucca's economy has since remained stable. In 2006, the estimated population was over 7,900, with ranching, mining, and tourism as important industries.

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