The nearby gypsum mine was purchased in 1923 by the Blue Diamond Corporation of California. The company opened a wallboard manufacturing plant at the site in 1941, and then began building a company town in 1942. The village of Cottonwood became known as Blue Diamondville that year, when a post office opened under that name. The name was changed to Blue Diamond later in the year, although some authorities continued to refer to it as Blue Diamondville until at least 1950.
The nearby gypsum mine was purchased in 1923 by the Blue Diamond Corporation of California. The company opened a wallboard manufacturing plant at the site in 1941, and then began building a company town in 1942. The village of Cottonwood became known as Blue Diamondville that year, when a post office opened under that name. The name was changed to Blue Diamond later in the year, although some authorities continued to refer to it as Blue Diamondville until at least 1950.