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The area that is now Marion was used in the 1860s by rancher Samuel P. Hoyt, whose 600–700 head of cattle grazed over most of Marion’s land. The settlement itself was founded in the mid-1870s and was originally named “Morrell” after William Morrell, who built the first house. A large portion of the early settlers were Danish American immigrants, and the community was also often called “Denmark”.

The name Marion has been credited to two different sources: Francis Marion Lyman, who, as President of the Quorum of the Twelve Apostles of The Church of Jesus Christ of Latter-day Saints, organized the first ward in the area in 1909, and Marion Myrick Sorensen, who settled here with her first husband in 1882. The Marion precinct first appeared under that name in the 1900 census.

Marion made news in 1979 when resident and polygamist homeschooler John Singer was killed while resisting arrest. The community garnered further publicity in 1988 when Singer’s son-in-law, Addam Swapp, bombed the LDS stake center in Marion and was arrested after a 13-day standoff with state and federal law enforcement.

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