Allentown State Hospital was established in 1901 when the state declared they want to open a state-run homeopathic hospital for the insane. Construction began in 1904 after careful consideration of the best possible location. The hospital would finally open in October of 1912 after considerable delays in construction due to funding legislation. The architecture strongly resembled that of a Kirkbride plan and is considered to be built in a "Kirkbride block plan". The main difference is that each ward is connected by two-story walkways vs immediately connecting to the next ward. It opened with a capacity to hold 1,000 patients.

Allentown was a self-sustaining community with many acres of farmland surrounding the hospital grounds. By 1914, the institution was already running the risk of overcrowding. In 1930, the hospital opened the state's only facility for mentally ill children. The hospital continued to grow and expand over the years, reaching a patient population of 2,012 in 1950. The hospital would make national history when it became the first hospital to stop the use of seclusion in the entire United States in 1998. In 2008, the population had fallen significantly and was at the low number of 175 patients. The hospital closed its doors for good in 2010. After its closure, it has become the most protected and guarded abandoned property in the entire state. It was eventually demolished in 2020.