Fairbury is located in Jefferson County (of which it is the county seat) 26 miles southwest of Beatrice, between Harbine and Gilead along Highway 136 near The Little Blue River and Alexandra Lakes State Recreation Area.
Site of historic Rock Creek Station. In 1868 James B. Mattingly gave up freighting and built a sawmill on the banks of the Little Blue River. People, returning from the gold fields, were beginning to settle along the trail. Back in Illinois, Judge W. G. McDowell foresaw the coming of a railroad through the area and came to Nebraska to "start a town" in this fertile valley. In 1869 Mattingly and McDowell, each assigning 80 acres of the land they claimed, to start a town. For a name they chose McDowell's Illinois home, "Fairbury,".