In 1876 the Watson brothers; Harry F. Watson, Sidney Grandison Watson and Robert Mc Gregor Watson came from the Upper Murray where their father owned Walwa and Tintildra Stations. They brought 900-odd mixed cattle from Dotswood Station and started out for the Upper Diamantina.
They had a tedious trip to the Gregory River, having no roads to follow and always having to look ahead to find water and camping places. On arrival at the Gregory River they were surprised to see the clean running water and the lovely cabbage palms, Leichhardt trees and tea trees. They chose a camp on high land near a good crossing place on the river and turned the cattle out on the western side.
Robert McGregor left with the cattle and after approximately a year returned to the Gregory to find that his brothers and a George Cooper had built a log hut of one big room on this site, the present site of Gregory Downs Hotel. A stockyard and another log hut were being built on the west side of the river, where the present yard stands.
Due to the cost of supplies from Normanton (Burketown having been abandoned 12 years previously due to Gulf Fever) the brothers decided to buy their own schooner to bring supplies from Townsville to Burketown. This led to the Watson's building and starting a General Store, so re-establishing Burketown.
With this success they decided to start a store at Gregory itself '... later we moved the goods out of our store at Burketown to Gregory Downs to the present site of the Gregory Downs Hotel and Store and started a pub and store. It was the spot we first settled and built the homestead on when we arrived at the Gregory river, but travellers became a nuisance so we moved the homestead across the Gregory river where it still remains. ' RM. Watson
The business was sold to Mr Clark and his partner Mr Campbell, then sold on to William Barrett in 1889. On his death in 1892 his wife Emily Barrett took over the licence. Nicknamed 'Auntie Barrett', she went on to built a great reputation for excellent cooking, stocked from a splendid garden of vegetables.
Her hotel became a home away from home, and a haven of rest for many stockmen who were working on the surrounding stations. She also developed a small store that had a piano; on special occasions space would be cleared to make a dance floor. Before long this became inadequate and the Jockey Club would pull down the wall and extend the floor for the period of the races and race dances. 'Auntie Barrett' died in 1933.
Over the years since, various owners have held the licence, a tennis court has been added, the Ladies 'two-holer' catering for two different sizes (adults and children) has been upgraded, and the tradition of good hospitality and fine food continues through to this day.