A company town is a place where practically all stores and housing are owned by the one company that is the only employer. The company provides infrastructure (housing, stores, transportation, sewage and water) to enable workers to move there and live. Typically, such towns are founded in a remote location, so that residents cannot easily commute or shop elsewhere. Sometimes after a period of time the town attracts non-company residents, relatives and small business entrepreneurs, and people with other employment, such as railroad or highway employees. The original company may sell off the housing. Company towns are often planned with a suite of amenities such as stores, churches, schools, markets and recreation facilities. In fast-growing remote areas companies planned housing to support the business' needs, and then hired workers to build an infrastructure and more workers to staff the business needs. Historian Linda Carlson argues that the managers of corporate towns in the early 20th century believed they could avoid the mistakes made by George Pullman in the 1880s. She says they:

wanted to create a better life for their employees: decent housing, good schools, and a "morally uplifting" society. In return, they expected stable, hard-working employees who would eschew the evils of drink and, most important, not fall prey to the blandishments of union organizers.