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In 1789 at Sutton, Massachusetts, the territory known as “Township Number 1” was purchased by Colonel Johnathan Holman and Associates from the Committee for Sale of Eastern Lands. The township was later called Holmanstown and contained 30,020 acres, encompassing what is now the towns of Mexico and Dixfield. Separation into two towns took place in 1803, at which time Dixfield was incorporated, and Holmanstown kept its name. Governed as a plantation until it was incorporated into a town in 1818 under the laws of Massachusetts, of which state, Maine was yet a part. The town is described in history as being “chiefly devoted to her own interests.” The unique name to this area was inspired by local sympathy for the country of Mexico’s 1810–1821 fight for independence from Spain.
In February 1818, the Commonwealth of Massachusetts passed as act to establish the Town of Mexico in the County of Oxford. Section 2 of that act instructed that “the inhabitants thereof to meet at such convenient time and place as shall be appointed in the said warrant for the choice of such officers as towns are by law empowered and required to choose, at their annual town meetings. The bill passed the House of Representatives on February 12, 1818, and the Senate on February 13, 1818.