Driving through Talihina, Oklahoma

The community was founded as a station stop on the St. Louis and San Francisco Railroad, which opened through the Indian Territory in June 1887. A post office opened at Talihina, Indian Territory on November 30, 1887. Talihina is the Choctaw Indian word for "railroad."

At the time of its founding, Talihina was located in Wade County, a part of the Apukshunnubbee District of the Choctaw Nation.

The railroad opened the surrounding area to ship cattle, timber, and cotton to Eastern markets and facilitated growth of the town. When Talihina incorporated in 1905, the town claimed a population of 400. Two major hospitals, the Choctaw-Chickasaw Tuberculosis Sanatorium and the Eastern Oklahoma State Tuberculosis Sanatorium, were built here between 1915 and 1921. By 1920, the population had grown to 690.

Tourism and recreation have been a major economic stimulus since the 1920s. Six lakes have been built in the Kiamichi Valley, attracting sportsmen and campers. Talimena State Park and Old Military Road historic site (National Register of Historic Places, NR 76002155) are 7 miles (11 km) northeast of Talihina. This is the western end of the Talimena Scenic Drive, which runs to Mena, Arkansas and attracts many people to view the fall foliage.

The Choctaw Nation Health Center was constructed in Talihina in 1999.