The city, a timber and farming community southwest of Portland and northwest of Salem, was incorporated in 1880. Sheridan was named for General Philip Sheridan, who was posted to Yamhill County and Fort Yamhill in the latter half of the 1850s to monitor the Native Americans at what is now the Grand Ronde Reservation west of the city. By 1894, the city had grown to 400 residents, one bank, two hotels, three churches, and a flouring mill. At that time there was a daily train to the city as well as daily stage coach service from McMinnville, and a single wooden bridge over the river.