1846 was a watershed year in the development of the city. The county population was listed as 732 early in the year but, by year's end, it had jumped to 2,787, or almost four times the earlier figure. The summer of 1846 saw considerable growth in the little village as settlers moved in to take advantage of the settlement's location on the river and near the immense pine forests to the north and west. The next year, 1847, two steam lumber mills started up and the industry which was responsible for the rapid rise of the city was born. By 1850, the village was the official county seat with a population of 1,392. Three years later it officially incorporated as a city.

As the lumber industry grew, so did the city. With the exception of a few years in the mid-1850's, expansion and growth was rapid. Initially, the number and capacity of the mills and shingle factories grew too fast. Due to a poor transportation system, the market for these products was generally confined to the immediate area and overproduction caused some mills to close. However, the railroad arrived in 1859 and over the next twenty years the market available to Oshkosh products grew with every new rail connection.

By 1860, eleven mills operated in the city. The arrival of the railroad coupled with increased orders for lumber products brought about by the Civil War caused Oshkosh to boom in the early 1860's. By 1866 the number of mills had jumped to 30 and, although there were periods of recession just after the war, this growth largely continued until the mid-1870's.

The years 1874 and 1875 were another watershed period for two reasons. On the one hand, 1874 was the peak year for mill activity in the city with 47 sawmills and 15 shingle mills in operation. Beginning in 1875, the number of mills and later, board feet of production stopped growing appreciably and, after 1890, began a slow decline until the last log drive was held on the Fox River in 1911. Saw and shingle mills continued for a time afterward but they no longer constituted a major industry. This decline was brought about by the clearing of the closest forestlands, which resulted in the raw materials being further and further away from the mills in Oshkosh. By the late 1870's, the sawmill industry was beginning to move to areas further to the north and northwest in Wisconsin.

The second set of major events centered around the fires of 1874 and 1875. Two fires in the summer of 1874 destroyed large portions of the north side of the city including the Main Street business district north of Algoma Boulevard. The next summer the Great Fire of 1875 destroyed Main Street between Algoma and Ceape Street and a larger area of homes, industries and businesses to the east and west of Main. This was the last of a series of five bad fires which began in 1859 and destroyed portions of the business district on four separate occasions. Following the fire in the summer of 1875, the downtown was rebuilt in brick, fire prevention methods were improved, and a sense of permanence developed. Indeed, the fire of 1875 was the last which destroyed a large portion of the city and many of those buildings erected following the fire still remain.

After the fires, growth continued at a quick pace. By 1890, the population had expanded to 22,836 and four railroads served the city. The railroad was the means by which Oshkosh reached out to the world. According to Eileen Weigert's article in Metz' anthology, Prairie. Pines and People, there were thirty-two passenger trains and forty-eight freight trains which served the city daily by 1910.

Oshkosh grew throughout the nineteenth century and into the twentieth. As the lumber industry declined, other industries took its place. The Paine Lumber Company became the city's largest employer and the world's largest sash and door factory until the Great Depression caused much of that plant, as well as many of the others in the City, to shut down.

As industry in the city changed, the type of resident changed as well. The original settlers were primarily Yankees moving west in search of cheap land for farming and opportunities for commercial success. Later, as industry grew and jobs were created, immigrants began to move to Oshkosh in large numbers. German and Irish workers and Welsh farmers were the first to arrive. Later Poles, Volga-Germans, and Scandinavians also arrived in large numbers. It has been estimated that by 1900 fully one-third of the residents of Oshkosh were German-speaking or of German parentage.

In the late nineteenth and early twentieth centuries Oshkosh was second only to Milwaukee in population in the State. It was the largest city in the Fox River Valley. The Inland Lakes Yachting Association held its annual regatta at the Oshkosh Yacht Club on Lake Winnebago and, following its construction in 1883, the Grand Opera House was visited by many of the biggest stars in the theater, vaudeville and lecture circuits making Oshkosh the cultural center of the Fox Valley.

This city, like most throughout the country, contributed soldiers and supplies to both World War I and II. It suffered with the rest of the nation through the Depression. However, Oshkosh not only survived; it prospered.