The city of Fernley owes its existence to the Newlands Project, which began irrigating a small number of farms in an arid region of western Nevada in 1905. The project, which diverted water from the Truckee River, was the first of its kind to be federally funded. The overall success of the endeavor is debatable to this day, but there is no doubt that it gave birth to the town of Fernley.

Many settlers who came to Fernley after the completion of the canal were frustrated by the lack of water and left after a short time. But those who stayed worked hard to prove the land could be successfully farmed. The town's people erected a schoolhouse in 1908, which accommodated twelve students. The Fernley Improvement Hall was built in 1913, and hosted many city functions, from basketball games to funerals. A community center was built in 1915.

Fernley continued as a sleepy agricultural town for decades, until it began to serve as a bedroom community for Reno, thirty miles to the west. Many who worked in Reno in the late 1970s, but could not afford a home there, lived in Fernley. This trend continued in spurts, and in 1990, Fernley supported a population of 5,164.

In 1964, the Nevada Cement Company opened just outside Fernley, and was designed to manufacture 175,000 tons of cement annually. The company manufactured the product from raw materials mined in a quarry four miles south of Fernley, as well as from silica in Pershing County, and gypsum in Gerlach. In 1969, the plant's capacity was doubled with the addition of a second kiln and two finished grinding systems. Today, the operation produces approximately 560,000 tons of cement annually, and employs about 125 workers. Outside of recurring maintenance, it operates twenty-four hours per day, seven days per week.

Fernley began to grow rapidly in the mid-1990s, in part because of the construction of a 5,000-acre industrial park. The complex attracted many large businesses, created jobs, and led to a population boom. In the decade after 1990, Fernley grew by over sixty-five percent, and had a population of 8,543 in 2000.

In an effort to manage its rapid growth, Fernley incorporated on July 1, 2001. Between 2004 and 2005, Fernley grew by nineteen percent, making it the fastest growing community in the state of Nevada during those years. The town's primary growing pain was finding adequate water resources, a challenge that persists.

Amazon.com, Trex Inc., and UPS Worldwide Logistics are among the major businesses that have chosen Fernley for warehousing. The town's geographical position makes it an ideal distribution center for western states, and transportation options from Fernley are numerous, with easy access to Interstate 80, U.S Alt. 95, U.S. Alt. 50, and the Union Pacific Railroad. In addition, Reno-Tahoe International Airport is just thirty miles away. Amazon.com, which opened its warehouse in 1999, is still among the largest distribution centers in Fernley. In 2009, the US Census Bureau estimated the town's population to be 12,167.

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