Coal was discovered in the Sheerness area by a cattleman who was wintering his herd in 1905/1906. His water supply was running low, so he decided to dig a well. At a depth of about ten feet he found a coal seam that was five feet thick. Not only did he find water, he discovered a coal field that would supply many settlers with a source of fuel and later, provide power to a large number of Albertans.

Colonel Walker of Calgary and Tex Oscar, with John Smith as a partner, were the first to operate a mine in the area. Tex Oscar farmed with his family a few miles north of the mine site. John Smith and his mother owned most of the land that the town would be developed on. John owned and operated the first livery barn along with the first pool hall. Together they started the first boarding house. John later acquired the general store that was operated by two Englishmen, Alf Minto and Lou Fields.

Mr. George Crozier, who ran the first post office at his homestead chose the name of Sheerness in memory of a seaport town on the east coast of England. The post office was moved from the Crozier farm to the mine site in 1910.

The school (pictured) came from a few miles north and was moved to the mine site in 1918.  Later, the Richdale school was moved into town and added onto the existing Sheerness school making a three room school house. The Richdale school can be seen as the 'front' section of school now. It was built in 1917 by Bill Williams and Fred Blackmore.

With the coming of the railroad in 1919 the town site was moved a short distance northwest in order to be closer to the train station. Many new businesses came into existence, serving the growing population. A meat market, Chinese restaurant, lumberyard, general store, a Bank of Toronto, and a laundry all made up the town. Friday night dances, a yearly stampede, a tennis court, pool hall, and ball games against neighboring communities on Sundays all provided residents with entertainment.

The store (pictured) opened in 1923 by Harold (Pop) Lucke after the previous store, owned by Erb Debow, burnt in a fire that also claimed the pool hall. Mr Lucke's house and barn were moved off of the family farm and into Sheerness in 1925. The Lucke family sold the store to Mr. McConkey when they moved to B.C. In 1935.

An Alberta Pacific Grain Company elevator was built in 1923. Alberta Wheat Pool bought the elevator in 1948, closed it in 1961, and dismantled it in 1963.

Over the years Sheerness was home to many different coal mines that changed hands several times. With natural gas becoming a more viable source of energy, coal became less important and many of the mine workers transferred to other mines in Alberta. By 1970 the school, store, and post office had all closed and the remaining residents moved to Hanna. In the 1950s approximately 150 people lived in Sheerness. Today only one family is still living on the original town site.

The Sheerness area is still known for coal mining. The Westmoreland Coal Company mine and the coal fired power plant are co-owned by ATCO Power and TransAlta. The 780 megawatt Sheerness thermal generating station has been in operation since 1986.