In March 1934, the home of William Sydney Porter (O. Henry) and Athol Estes Porter was permanently relocated to Brush Square in Austin, Texas. The 1888 Queen Anne-style cottage had been left derelict for many years, and Brush Square was the logical choice for the first city-operated museum. Brush Square was one of the four original parks conceived in the 1839 Edwin Waller Downtown Austin Plan, adding historic significance to the placement.

In 1974, the O. Henry Museum was placed on the National Historic Register and, in 1999, the museum received Library of Congress Literary Landmark status.

Early on, special effort was made to furnish the home with Porter family artifacts. A piano the couple had played during their courtship, chairs that possibly inspired the story "Gift of the Magi," along with letters, personal items, a bedroom set, diaries, original manuscripts, and a musical score from Porter’s Broadway play are on exhibit. Since 1972, the O. Henry Museum has hosted writing workshops, poetry readings, and a word play competition: the O. Henry Museum World Championship Pun Off. The museum has been curated by the City of Austin Parks and Recreation Department for the past 85 years.