Gun Barrel City is a city in Henderson County, Texas, United States. The population was 5,145 at the 2000 census. Gun Barrel City was incorporated on May 26, 1969. Since that time, Gun Barrel City has grown into the central hub and access point for the waters of Cedar Creek Lake. This has led visitors from around the region to use Gun Barrel City as the gateway into the lake. The town began as an unincorporated community known as the "Old Bethel Community" in the 1960s after completion of Cedar Creek Reservoir. It was incorporated in the late 1960s so it could legally sell beer and wine.