The Damascus Lumber Company was originally formed by two men from Pennsylvania. These men were H. E. Clark, and J. W. McCullough, who chartered the company in Delaware with operations in Damascus, Virginia, on September 12th, 1907. That same year, the Industrial Development & Manufacturers' Record mentions that the company had purchased 12,000 acres of timber for an average of 60,000 to 75,000 feet of cut lumber per day. The company operated their mill in Laureldale, Virginia, (East of Damascus) in 1908 and were contracted by the nearby T. W. Thayer Lumber Company to cut all their harvested timber. The company owned two small geared steam locomotives to switch the mill and work the logging spurs in Eastern Tennessee and Western North Carolina which the company owned. Both lines were narrow gauge which allowed easy transferring of logs and finished cut lumber. 

The lumber company also had a small narrow gauge line, which connected to the T. W. Thayers *Laurel Railway* line at Laurel Bloomery, Tennessee, and was constructed to harvest rich white pine plentiful in the area. The Damascus Lumber Company had many logging spurs in Ashe County, North Carolina (Especially around Pond Mountain) and Johnson County, Tennessee (Around a place called Bethel), but eventually, like all logging railroads of the era, the timber dried up and so did all the logging spurs owned by the company. 

The last spur was finally removed in 1919. Even with the Damascus Lumber Company abandoning all it's privately owned lines, the band mill continued operation. However, tragedy struck when the sawmill at Laureldale was destroyed by a fire in 1921. The complex was still producing between 18 to 21 million board feet annually. Before anything else could go wrong, the owners sold the company to a competitor and on March 16, 1923, the company was bought by the nearby Hassinger Lumber Company of Konnarock, Virginia, and the mill at Laureldale was rebuilt for Hassinger lumber use. Hassinger rebuilt the mill into a flooring plant and operated it until 1930 when it finally closed down for good.