Gold mining in the Tarnagulla district began in 1853, and in 1856 gold was discovered at a nearby rise known as Hard Hills, west of the present site of Llanelly.[4] Further reef discoveries followed over the next two years around and east of Llanelly, encouraging permanent settlement, and by about 1860 a village had formed and was named Llanelly by Welsh miners.[4] The discovery of alluvial gold in 1865 led to rapid population growth, and at its peak the Llanelly goldfields were reported to support a population of up to 20,000 people.[4] For decades, Welsh, rather than English, was the dominant language of Llanelly.[5]
The expansion of the goldfields supported the development of stores, hotels and banks, and the town remained prosperous until declining yields in the following decade slowed growth.[4] Between 1872 and 1882 the settlement was officially known as Maidentown, before the name Llanelly was reinstated prior to the opening of the railway line from Dunolly in 1888.[4] By the 1920s most local businesses had closed apart from the post office and general store, and the town's role as a service centre continued to diminish.[4] The opening of a grain silo at the railway station in 1951 reflected a shift away from small mixed farming, while the school had closed in 1950 and was later converted into a public hall.[4]
