Shannon City is the youngest of the incorporated communities in Union County. It was surveyed by the Great Western Chicago Railway (GWCRR) in 1887 as a possible stop and platted a year later. Officials rejected the original name of ‘Shannon’, as there were already several towns in Iowa with similar names. The second choice of ‘Loomis’ was suggested as a nod to an early settler, Doctor F. W. Loomis. Dr. Loomis declined the honor, however, and instead suggested Shannon City, which has been the name of the town ever since.
At its peak in the early 1900s, Shannon City boasted four churches, two banks, a number of other shops and stores, and a population of nearly 400.