Due to the drought of 1977, Xenia Rural Water District was established to provide quality, reliable drinking water to rural landowners in Dallas and Boone counties. In 1978, the Board of Directors applied for a FmHA loan to design and build a water treatment plant and a distribution system to service the area. The loan was approved in the fall of 1981 and construction of the plant and the distribution system began in the spring of 1982 to provide service to 640 members including residents of the City of Bouton.
Expansion of Xenia's system began in 1990 by purchasing water from the City of Boone to provide water service further into Boone County. Service was extended into Polk and Southern Dallas Counties in 1994 by purchasing water from Des Moines Water Works. By 2000, Xenia acquired water purchase agreements from the City of Madrid, City of Ames and Warren Water District. The territory served had grown to also include the counties of Adair, Madison, Guthrie, Greene, and Story.
In 2004, Xenia built a three million gallon a day water treatment plant located north of Stratford. The water plant initially provided water to Webster and Hamilton County. The expansion of Xenia's territory ended in 2007 with the addition of eastern Calhoun County. All or portions of 11 counties, 16 communities and over 10,000 customers/members currently comprise Xenia Rural Water District.