1881 was the tenth year after the founding of the City of Birmingham.
- July 4: Tuskegee Institute opened.
- Fraternal Cemetery was established in Pratt City.
- The Georgia Pacific Railroad was constructed through the area where Leeds was then founded.
- Williamson Hawkins sold much of his former plantation to the Thomas Iron Company.
- The area of Southside near 18th Street South and 5th Avenue was attracting a "large number of new settlers around the big spring", attracted by the convenience of fresh water.
- July: Frank Evans bought a one-half interest in the Weekly Iron Age.
- Fall: The J. M. Maxwell & Company grocery wholesaler became McLester & Van Hoose.
- December 3: The Daily Age began publication.
- Truman Aldrich resigned from the Pratt Coal and Coke Company to found the Cahaba Coal Company.
- Henry F. DeBardeleben, final stakeholder in the Pratt Coal and Coke Company, sold it to Enoch Ensley for $600,000.
- Mitchell A. Porter became a partner in his father's law firm.
- The Sloss Furnace Company was founded.
- The Woodward Iron Company was started.
- Chambers McAdory was elected to the Alabama State Legislature.
- W. G. Oliver succeeded F. W. Beall as Birmingham Police Chief.
- June 18: Sixth Avenue Baptist Church was founded as the "Second Colored Baptist Church".
- Benjamin F. Hendon became pastor of Ruhama Baptist Church.
- Farmer Andrew Beard received his first patent, for a plow.
- Jabez Curry became an agent for the Peabody Education Fund and Slater Fund to aide schools in the South.
- Franklin Glass became editor of the Selma Times.
- Attorney Mitchell Porter moved to Birmingham.
- Thomas Walker moved to Birmingham.
- Madam Louise Wooster returned to Birmingham.
- Physician Benjamin Wyman moved to Tuscaloosa.
- April 8: David O. Whilldin, architect
- August 24: Fred McDuff, Birmingham Police Chief
- November 15: Mortimer Jordan, World War I hero
- May Hawes, murder victim
- Mitchell A. Porter from the University of Alabama School of Law, bachelor of laws
- James Stiles from the University of Mississippi, law degree
- The original Sixth Avenue Baptist ChurchSecond Colored Baptist Church building
- Charles Stillman residence
- James Van Hoose residence
In 1881, Phoenix, Arizona was incorporated. James A. Garfield was inaugurated as President. The First Boer War ended. The American Red Cross was founded. Billy the Kid was shot and killed by Sheriff Pat Garrett. The fifth hurricane of the Atlantic season hit Florida and the Carolinas, killing about 700. The Thumb Fire in Michigan destroyed over a million acres and killed 282 people. Chester A. Arthur succeeded Garfield as President after Garfield died from a shooting. The Gunfight at the O.K. Corral occurred in Tombstone, Arizona.
Notable books published in 1881 included The Black Robe by Wilkie Collins, The Portrait of a Lady by Henry James, and The Rise and Fall of the Confederate Government by Jefferson Davis. Notable music composed in 1881 included String Quartet No. 2 by Alexander Borodin, Pièces pittoresques by Emmanuel Chabrier, and Nuages Gris by Franz Liszt.
Notable births in 1881 included chemist Irving Langmuir, ballerina Anna Pavlova, actress Maude Fealy, composer Béla Bartók, fashion designer Guccio Gucci, Navy officer Kenneth Whiting, film director Cecil B. DeMille, airplane manufacturer William Boeing, writer P. G. Wodehouse, painter Pablo Picasso, and columnist Franklin Pierce Adams. Notable deaths included painting subject Anna McNeill Whistler, author Fyodor Dostoyevsky, Emperor Alexander II of Russia (assassinated), former British Prime Minister Benjamin Disraeli, Billy the Kid (killed), and President James A. Garfield (assassinated).
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