Folsom prospered in the early years, with the largest stockyards west of Fort Worth. Homesteaders moved in and attempted to farm, and the town reached a peak population of nearly 1,000. The area proved unsuitable for farming, though, because of drought, and large ranches soon replaced the small farms. The town suffered a blow from which it never recovered on August 27, 1908, when a massive rainstorm caused a devastating flood, which nearly destroyed the town and killed 18 people. (Flash flooding from the same storm also uncovered the bison bones that George McJunkin found in Dead Horse Arroyo, which later became known as the Folsom Site.)