In April 1867, the Virginia General Assembly granted a charter to the Winchester and Strasburg Railroad Company. The company was authorized to construct a rail line between Winchester and Strasburg, linking Newtown to the rest of the nation by railroad for the first time. Though the railroad improved the local economy, which had lagged after the end of the war, it decimated the wagon-building trade. In 1880, the United States Post Office Department, faced with nearly a dozen Newtowns in Virginia, announced that the local post office would be renamed "Pantops". Dissatisfied with the name, the townsfolk chose "Stephens City".