Coalgate originated from coal mining activity and was the site of a mining camp. The majority of miners were migrant workers. In 1883 the son of an Irish immigrant, Patrick Jay Hurley, grew up struggling as a miner in the nearby town of Lehigh, Ok. Hurley befriended an Indian boy who later became principal chief of the Choctaws and was allowed to use the family library for his studies. At age 15 Hurley worked as a ranch hand and at age 18 he acquired a position as caretaker at Bacone College where he attended night classes graduating with an A.B. in 1905. In 1908 Hurley attained a law degree and was retained as a lawyer for the Choctaw tribe. Hurley practiced law before the U S Supreme Court from 1912-1917. With profiteers beckoning, Hurley assisted Choctaws and kept their wealth in Coal mining territory. Around the turn of the century Hurley also followed a military career moving up to Major General during World War II, serving as Sec. Of War, Minister to New Zealand and special ambassador to several countries. In later years living out his life in Santa Fe, NM until his death in 1963, Hurley's endearment to Coal County friends encouraged frequent visits and a strong voice for Indian rights.

In Coalgate three railroads were active around 1885, Okla. City, Ada, and Atoka, Rock Island and the Missouri, Kansas and Texas Railroad. During this time the town was called Liddle and was well known by June 23, 1890 when the bank was established. In 1898 the Post Office was established and an application for incorporation of the city of Liddle were being drawn up. At a meeting of the M.K.&T. Railroad board of directors, it was mentioned that a good name for the city would be Coalgate for their President, Coalgate Hoyt. Also the area had grown due to coal activity and a slogan derived from the early day coal mining camps had been, "A GATE to wealth from the COAL Industry." The idea appealed to the city organizers and the city was incorporated as Coalgate later that year. It established a home rule charter, council, manager form of city government, which it still uses.

Coalgate had grown to a population of 2,921 by statehood in 1907 and in one year the population had increased to 3,500. The city had at least 65 merchants plus carpenters, doctors, veterinarians, and as many as seven attorneys and three newspapers. The streets in the downtown area were bricked in 1912 and Coalgate continued to grow until 1925 when the coalmines began to close. Since this time agriculture and manufacturing have become the leading industries.