Bon Air, the company's first town, named for the White County's ante-bellum Bon Air Springs summer resort, was literally built on the mountainside near the mouth of the “Old Number One” mine. By 1888, this little village contained eleven log cabins and one log boarding house. Apparently, these structures were overcrowded and not exactly airtight. In his autobiography, Dr. William Byrd Young, writing about his first night's stay at the boarding house in March 1888, stated that he shared his room with six other men and, since the buildings had been “hurriedly thrown up . . . there were cracks between the logs [through] which a cat might have been thrown.” The next morning he awoke amid his roommates' laughter. Red streaks covered his face, for his red blanket had faded from rainfall through those cracks during the night.

With the coming of the railroad in 1888 and expanding mine operations, Bon Air grew rapidly. The railroad depot, additional houses, mine buildings, and a school were soon built.

The ground under most of the buildings began to slide down the mountain around 1891 and Bon Air was relocated on the tableland overlooking the mine entrances.  Following this move, the first town was known as Old Town, and the second site acquired the Bon Air name.

New Bon Air had a main or business street called “front street” with eight or ten residential streets, referred to as “alleys,” running perpendicular to it. Several large elegant homes owned by three or four major stockholders were located just west of Bon Air near a bluff overlooking the valley below. Logs or crossties bounded the town's cinder-filled streets and sidewalks.

Buildings directly related to mine operations, such as tipples and boiler houses, were located on sites near the mine openings. Exceptions to this were the mule barns and blacksmith shop which were constructed on the Carola Road about a mile southwest of Bon Air. The railroad depot was not moved to the mountain top. Rather, it nestled into the mountainside next to the railroad tracks about seventy-five feet below the summit. A mechanical hoist and incline car constructed from a modified rail car provided a means to transport freight and occasionally passengers from the track level to the town above.

Bon Air's business section included a company-owned general store, company office, butcher shop, cobbler shop, barber shop, and jail-house. Community buildings, also situated on “front street,” consisted of a school, a church, a clubhouse, and a ballpark. Even though these structures served their intended purpose, the town's populace seemed to consider the company store built in 1893-1894 as the hub of the town.

This large two-story red brick building had both front and side porches as well as a large warehouse and an ice house connected to the back entrance by a covered walkway. All the store's merchandise came in on the trains and was delivered to the rear entrance via the incline car. A hitching post at the front of the store provided restraint for the horses that were the primary means of transportation during this time. It was not until the late 1920s that this area became parking spaces for automobiles.

As a result of this influx, the towns grew rapidly. Census figures and newspaper articles indicated that in 1890 only 253 people lived in the thirteenth civil district of White County (the Bon Air Mountain area). By 1900, however, a new district had been formed (the fourteenth), and these combined districts had a population of 1,578 with Bon Air the only town boasting 991 of those people (at that time Bon Air's population surpassed Sparta's by 96 people). Both a population shift and growth occurred by the next census in 1910. Bon Air's populace decreased from 991 to 517 because miners had moved to Ravenscroft (population 481), Eastland (population 334), and Clifty (population 596). The inhabitants of the towns and the two mountain districts totaled 2,643. Population growth actually peaked in 1920 with 3,054 residents.