The area that covers both Roslyn and Lake Cle Elum was used by the Native American tribes there for centuries, the Kittitas tribe was the most notable group that used this area. Despite the use from tribes, the town site of the Roslyn area would not be deemed useful or interesting until the discovery of coal.

The earliest record of coal discovery in what is now Roslyn goes back to 1871, where Nez "Cayuse" Jensen and a few early prospectors found a small amount of coal. The early 1880s saw Jensen build a log cabin that still stands in Roslyn to this day. In May 1886, a team from the Northern Pacific was working to get to the Cascades towards the Stampede Pass and found a large amount of coal at the site of Roslyn.

By August of that year, the Northern Pacific sent a crew to begin mining coal in that area. A rail line was built to move coal to the main line at Cle Elum in a more efficient manner. Workers from all around came to work at the coal mines. Then vice-president of the Northern Pacific Coal Company, Logan M. Bullitt, was in charge of the coal operations in this area, and gave this place the name Roslyn.

On August 17, the town of Roslyn had its first labor strike by coal miners. A new union called the Knights of Labor was the group that started the strike, looking to get higher wages for their work, and reducing the work day from ten hours to eight hours. The Northern Pacific tried to stop this strike by bringing a trainload of 50 African American miners from the Midwest and East to replace the striking miners. This effort had the help of James E. Shepperson, a famed labor recruiter that had previously worked in Pennsylvania and Illinois before moving to Kittitas County in 1888 in response to mining jobs. To aid the Northern Pacific Railroad, Shepperson not only recruited these former slaves to Mine No. 3, but he would work to recruit a total of 400 black men as strikebreakers.

About 40 armed company guards were called in to protect these miners from the strikers with the initial 40 miners. These men also carried guns on their person to ensure their safety. Territorial Governor Eugene Semple wanted to prevent the armed private militia from crossing the line from protecting company property to vigilante justice, so he came in and ordered the guards to disband. Some accounts state that the racial dispute was not the core of the problem. The miners on strike saw the black miners as a threat to the union wages and ultimately viewed them as corporate tools to silence them. The strike was eventually settled as the black miners were allowed to stay on the crew, and their families were brought in as well. As the mining boom continued, jobs were easier to get for everyone, and the racial tension died down as they worked together.

By 1892, Mine No. 1 had expanded to a total of 2,700 feet below the town to mine for coal. In this space were eleven furnaces to ventilate the air being breathed in by miners, eliminating firedamp (deadly methane gas). The fourth and lower levels of the mine did not have access to the main airway. Instead, a slope below the fourth level provided a small amount of ventilation, although it was not as safe as higher levels. May 10, 1892 saw miners attempt to connect the main air ventilation system, but the firedamp gas had detonated, creating an explosion in the mine.

A recovery effort for the trapped miners had begun, but the ones who made it out were hesitant to go back down. Despite this nervousness, the first day of rescuing was able to remove 14 bodies from the mine. By the end of Thursday of that week, all of the 45 miners trapped in Mine No. 1 had been recovered, although none of them were alive to tell the tale. Many of the victims suffered from burns and all of them were buried in local cemeteries. The multiple cemeteries located in Roslyn were separated originally due to segregation, but grew as each lodge, organization, and culture developed their own dedicated resting places.

In response to wanting to understand how this explosion had occurred, investigations from the State Coal Mine Inspector, First District Coal Mine Inspector David Edmunds, had begun in Mine No. 1. The company committee for the mine had stated that the effort to ventilate the air for levels lower than the fourth level had been the main cause. They claimed that the explosion had been set off by blasting powder used to break the rock. Despite this, the State Inspector of Mines had the suspicion that the true cause for the explosion was a crack was opened to a miner's lamp on the slope of the fourth mining level, setting off the explosion.

Most miners had worked with lamps with flames to light the way down the mines. As coal contains methane and is in a dusty mine, an explosion would be able to distill more gas from this coal dust, fueling the fire. Later coal mines would be sprinkled with water to control the dust and rock-dust the mines to eliminate the probability of an explosion. At Mine No. 1, those who weren't killed by the explosion were asphyxiated.

But whatever the reason, the cause of the fire was mostly believed to be "deficient ventilation".

This explosion had created 29 widows and 91 orphans. Some of these parties had sued the Northern Pacific Coal Company, some settling with $1,000. The 45 victims of the explosion are memorialized in the Coal Miners Memorial in Roslyn today.

The 45 killed miners were:

As oil was being discovered, it began to take coal's role as the nation's most important fuel source. The only time where coal would be considered the more important fuel than oil was in World War I for a short time. After that brief moment, coal was much cheaper in other states than in Washington. By 1920, Roslyn's population had dropped down to 2,673. With the coal jobs in the town disappearing, many of the imported residents took their things and moved away. The town's black population also went to other cities such as Seattle and Tacoma to find work.

For those who still worked at the coal mines, two strikes had closed the mines for a couple of weeks in 1919. In the early 1920s strikes from the United Mine Workers became more common in the community, even reaching a point where attempts to break the union were made. However, because the industry declined alongside the power of the unions, the mine workers were forced to get a wage cut from $8.25 per day to $7.50 per day in 1922.

In 1929, the Great Depression caused conditions to get worse for workers. By 1930, Roslyn's population dropped yet again, this time going down to 2,063. Unionized miners had become more and more unsatisfied with the United Mine Workers, making the new Western Miners of America group's efforts to recruit them an easy task. This group went on strike in 1934. The city became divided, either being on the side of the UMW with the company or the Western Miners of America, going so far as to fight and throw rocks at each other.

The Western Miners were the ultimate winners of this dispute, and the striking miners were never hired back to the group. During this, diesel fuel had replaced coal powered means of transportation, even reaching train locomotives. Roslyn's population had dropped so far from it's glory days that in 1950 it had dropped to 1,537.

The population had risen for the first time in decades thanks to Northern Exposure, going up to 1,017. The population had been stable since then, but the real rise of tourism came from outside the city limits, in between Roslyn and Cle Elum. A new recreational and residential resort called Suncadia was opened, complete with an inn, golf courses, and horseback facilities two miles away from Roslyn in 2004. The first Suncadia homes were completed in 2005, and a new lodge and spa were opened in 2008.