Nacmine originated as a planned company town in the Drumheller Valley during the early 1910s, amid a coal mining rush sparked by geological surveys that identified significant deposits in the region starting in 1911. Established by North American Collieries (NAC), the settlement was initially named Monarch to reflect its ties to the company's early operations in the area. By 1913, when the associated mine commenced production, the town had begun taking shape as a self-contained community designed to support coal workers and their families. The name was later changed to Nacmine, a portmanteau of "NAC" and "mine," by the time the post office opened in 1919.

Situated approximately four miles west of Drumheller along the Red Deer River and on the main Calgary-Saskatoon highway, Nacmine's location facilitated access to transportation routes essential for coal distribution. North American Collieries invested in modern infrastructure from the outset, constructing company-owned housing that prioritized family living over traditional mining camps. These included colorful family homes built on spacious lots exceeding 100 feet, each typically featuring surrounding gardens to promote a sense of community and well-being; notably, the company eliminated outdated bunkhouses in favor of these permanent residences.

Basic community facilities were also established early to attract and retain workers. A modern school building served the educational needs of children, complemented by teacher bungalows equipped with furnaces, running water, and electric lights—amenities that were advanced for a remote mining town in the 1910s. This foundational setup laid the groundwork for Nacmine's growth as the valley's coal operations expanded in the ensuing decade.
The Post Office opened on April 1, 1919.