Rusk State Hospital is an inpatient hospital providing psychiatric treatment and care for citizens primarily from the East Texas region.  It is located on property owned by the State of Texas since 1877. Construction was completed in 1878 on a 576-foot long, three-story penitentiary. It is now the hospital's administration building.

During the early years the prisoners assisted in construction of the Texas State Railroad from Rusk to Palestine. The railroad was the only state-owned railroad until 2007 when it was privatized, and it is a current tourist attraction. The prisoners also built the Old Alcalde, an iron ore smelting furnace adjacent to the main building. The furnace's iron and iron products were used in many Texas state buildings and throughout the United States.

When the prison closed in 1917, the Texas legislature authorized and appropriated funds for its conversion to a mental hospital. On June 11, 1919, the hospital received its first patient. The facility was named Rusk State Hospital by the legislature in 1925. The Skyview Maximum Security Unit for mentally ill offenders from throughout Texas was established in 1953 and was transferred to Vernon State Hospital in 1988.

Now under the supervision of the Texas Department of State Health Services, Rusk State Hospital is one of the nine state hospitals sharing the responsibility of conserving the mental health of Texas citizens and helping persons with mental retardation achieve their maximum potential.

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