The Collinwood Land Company advertised lots for the new city in June 1913, and by the following year, about 300 people were living in the city. Most of the residents worked for the railroad or in the local lumber industry. During World War I, Collinwood's economy boomed, and its population swelled to over 2,000. A wood alcohol (methanol) distillation plant and blast furnace were constructed in the years following the war, but as demand for these products fell, the economy collapsed and the city began to decline. The tracks connecting Collinwood with the L&N system were abandoned in the late 1930s.