Gause is on U.S. Highway 79 and the Missouri Pacific line sixteen miles southeast of Cameron in eastern Milam County. It was named for William J. Gause, who moved to the area in 1872 and built a home out of lumber hauled from Montgomery. In 1873 he gave right-of-way and 100 acres to the International-Great Northern Railroad, and the town of Gause grew rapidly. A schoolhouse, which doubled as a church, was built there in 1876. By 1884 Gause had steam cotton gins, grist and saw mills, two churches, and 300 residents. Area farmers shipped cotton, cottonseed oil, and corn. The Gause Independent School District, which was established in 1905, was the first such district in Milam County. The town reached its peak of prosperity around 1915 with an estimated population of 1,000. Gause began to decline in the 1920s. Its bank, which had been in operation since 1910, was discontinued in 1927. The number of businesses dropped from twenty in the early 1940s to four in the 1960s. Mechanized farming, improved highways, and the declining importance of the railroad contributed to a decrease in commercial activity in Gause. The town's population fell from 750 in the 1940s to 278 by the late 1960s and 210 by the early 1970s. This downward trend was reversed in the late 1980s as more people chose to live in Gause and commute to jobs in nearby industrial plants. In the early 1990s Gause reported 400 residents and eight businesses. The population remained the same in 2000, though only four businesses were reported.
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