Original settlement in the area was sparse, and this in part explains the initial slow development of the town-site as a service centre. The first concern of the Mennonite settlers was to build a church; and the primary task of the settlers was to create farmsteads. Settlement prior to the post-1900 land rush was limited to the small group who came west in 1894.
1897 saw the arrival of the Canadian Pacific Railway, which pushed forward the town's development. The CPR constructed a station in the town in 1904. Didsbury was incorporated as a village in 1905 and as a town on September 6, 1906.