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The current town of Zionsville began as a promotion by railway speculator William Zion, who partnered with Boone County landowner Elijah Cross to build a railway station on Cross's land in Eagle Township. The town was chartered in 1852, and the first resident was John Miller, who built and lived in a boarding house. By the 1860 census, the population was counted at 364. In this period, local businesses and houses of worship, specifically the local Methodist and Church of Christ congregations, relocated from nearby Eagle Village, which had also been platted on land originally owned by Cross. According to the local Chamber of Commerce Abraham Lincoln made a whistle-stop speech in Zionsville in 1861 when traveling to his inauguration.

For much of the rest of its history, Zionsville has led a quiet existence, relying primarily upon its existence as a stop on passenger rail lines and later as a shopping destination or bedroom community. While white flight and other demographic changes in nearby Indianapolis greatly enlarged the city of Carmel and the town of Fishers in Hamilton County, especially since the imposition of Unigov in 1970, Zionsville had remained a much smaller locale until growth began to pick up into the mid to late 1990s.