Butler County was first organized in 1854 with Robert T. Crowell being appointed as the first Sheriff. Sheriff Crowell served until 1855 when Walker H. Bishop was elected sheriff.

In 1854 Clarksville became the first county seat for Butler County. In 1860 enough registered voters signed a petition to have the county seat moved. An election was held, and the county seat was then moved to Butler Center. In 1880 the Citizens of Clarksville circulated a petition to have the county seat moved back to Clarksville. The citizens in the rest of the county did not want the county seat back in Clarksville, and since the railroad was not going through Butler Center and would be going through the newly incorporated town of Allison, the voters elected to have the county seat moved there. In 1880 the county seat was moved to its present site at the end of main street in Allison. The new courthouse was built at a cost of $10,000, with the Sheriff's Office and jail being located there.

In 1928 a new jail was built east of the courthouse, for a cost of $14,000. The jail had office and jail space on the first floor and in the basement. In September of 1929 the jail got its first real use. That year the public school in Allison burned down, and because of a shortage of classroom space, the jail became a school. Classes for 3rd through 6th grades were held in the jail offices and cells for the remainder of the 1929-1930 school year. Since the Sheriff had not moved his office into the jail before the school burned, the Butler County Superintendent of schools moved in the jail building in 1930. The Superintendent used all the office space, while the Sheriff maintained his office in the courthouse. The Superintendent of schools would watch the prisoner(s) during his office hours. After hours and on weekends the prisoner(s) had telephone contact with the Sheriff's residence for emergencies. The Sheriff kept his office in the courthouse until the late 1960's when the Superintendent of schools moved out.

From 1928 until today the jail building has undergone several changes. In the early 1940's at the start of World War II, the cells in the basement of the jail were removed. The iron and steel from these cells were used in the war effort. In 1983 a new office area was added to the old jail building, and the cells were remodeled to conform with the state jail standards. In 1991 the jail changed again to accommodate more prisoners.. Besides holding prisoners for Butler County, the jail also holds prisoners for Franklin County. The revenue from holding out of county prisoners amounts to approximately $90,000 per year.