Sand Mountain Coffee House opened its doors in May of 1965. It replaced The Jester Lounge as the new folk club in town. Guy Clark, Townes Van Zandt, and Jerry Jeff Walker took up residence there. The establishment was strictly a coffee house that did not serve alcohol, but was quiet popular.
By 1969, the first generation of performers Van Zandt, Clark, and Walker moved on to larger success elsewhere. The next year original co-founder John Carrick transferred managing duties to his mother Corrine Carrick. While Mrs. Carrick had always been a strong force in the establishment, she took on a larger role. Around this time, Don Sanders, who had played at the venue for years, assisted with booking.
To keep up the times and competition from The Old Quarter, Sand Mountain began serving beer and wine in 1972. In mid-1974, Sand Mountain celebrated its upcoming tenth anniversary, but the establishment was coming to an end. Growing competition from other venues that catered to the newer crowd of folkies led to Sand Mountain closing around 1976 or early 1977.