Within a few years of the proclamation of South Australia most of the land around present day Mannum had been taken up by pastoralists such as John and James Chambers, Robert Frew, John Baker and several others. The earliest record of land sales was The Thirty Nine Sections Special Survey of 1840. By 1854 some 4,000 head of cattle were grazing on both sides of the river. The Hundred of The Murray was proclaimed in November 1853 and the first families took up residence.
In an effort to open up the river transport, William Randell built the Mary Ann at Mannum in 1852 and named her after his mother. It was the first ship build on the River Murray and launched from Noa No landing, three kilometres north of Mannum. Following its success, Randell moved his business base to Mannum which eventually became a centre for shipbuilding and transport. Three years later Mary Ann's hull was used to build the Paddle steamer Gemini.
After the successful voyage of the Lady Augusta and the Mary Ann, Captain William Randell added a cottage on the site of the present Mannum Hotel where on 22 April 1867 his wife had a son. Frank Randell built his wool store next to it and when Carl Theodore Polack bought three sections of land the Town of Mannum was on its way. Some of the first allotments were bought by P.D. Prankard and Robert Stuckey on 27 October 1864.
Even the government started to show some interest and considered the possibility of a rail head and agricultural settlement. Benjamin Baseby was the first to harvest a crop of wheat and a flour mill was erected by Benjamin Walker in 1875. A ferry operated and in 1882 the Bank of Adelaide opened a branch office in the town. The ferry was replaced in 1891 by a much larger and modern one. Eventually the town would be served by two ferries.
When the government town of Port Mannum was surveyed by William Pearson in 1864 and the private efforts of William Randell, who surveyed his own Mannum in 1869, many of the residents found work in supplying the steamers with wood, ship repairing, loading and unloading and general transport. Randell's Port Mannum was divided into 63 lots of various sizes. Other sections surveyed later were Mannum South and North Mannum. Carl Mau subdivided Mannum West and F.E. Schuetze laid out Mannum South West and Mannumville.
A school was opened in 1871 with William Ambrose teaching some thirty-five students. Unfortunately attendance was not always what it should have been. In 1880 the Chairman of the Mannum School Board commented that 'The attendance at the school is very lax as it is the custom to send children out getting gum and bark at an early age'. By 1877 the area had grown enough for the residents to successfully petition the government for a District Council. It was proclaimed on 23 August 1877. The first Councillors of the District Council of Mannum were W.Bottroff, A.Faehrmann, H.Hancke, all from Germany and J.Walker and E.Wilson.
After the passing of the Strangways Act in 1869, wheat growing increased dramatically. Unfortunately the rain did not and there were many years when rainfall was too low for a good crop. On top of this were the high transport costs which were not easy to overcome. Even so, by 1879 nearly 8,000 acres were sown with wheat.
At the beginning of the 1880s the town had a population of more than seven hundred and some 150 houses. By now it also had a police station, a Lutheran Church, butchers, bakers, millers, saddlers, engineers, a dry dock, opened in 1876 by William Randell, a hotel, the Bogan, where G.W. Schuetze was the publican in 1874 and a school attended by sixty students. In 1881 the population had increased to 773 and ten years later there were 1675 residents in town
It also had a German school which was well attended. When Local History was introduced in the South Australian Curriculum, students at Mannum produced an excellent village survey which was later deposited in the South Australian Public Record Office. The Lutheran Congregation of St Martin was organised by Pastor J.M.R. Ey of Lobethal in 1880. When started, it had fifty communicants but this grew to 190 in 1932 when it had 259 members. Services were at first conducted in the Public School until their own church was opened on 2 July 1882.
Pastor Ey was replaced in 1888 by Pastor H.Alpers from the Hermannsburg Missionary Seminary in Germany. He stayed for 43 years. During his time he officiated at 110 marriages, baptised 515 children and buried 95 church members. When the school was closed by the government in 1917, the building was used for religious instruction on Saterdays.
In 1889 law and order was looked after by the police and the Local Court. The Clerk of the Local Court was H.H. McKirdy, who was also the Postmaster. The Bailiff was M. Hurley and the Resident Justices were Benjamin Basely, G.W. Schuetze and John Walker.
Besides the river trade, the town had also developed a substantial manufacturing industry, the largest being that of John and David Shearer. David had previously laid out a subdivision which was called Boomerang. The Shearer brothers produced cast-iron ploughshares and from 1888 onwards wrought steel ploughshares. Later they added the stripper followed by almost any other agricultural implement. Their farm machinery opened up the Mallee and many of the harvesters were shipped via the river to the other colonies. Australia's first car was built in Mannum by David Shearer. By the turn of the century Shearer employed more than a hundred men. Other large employers were A.H. Landseer, a shipping agent and merchant of Milang, Carl Mau, tinsmith and plumber from Germany, Johan Arnold from Sweden and the Schuetze family who also came from Germany.
When the railway reached Morgan in 1878 and Murray Bridge in 1886 Mannum lost most of its river trade which had been an important part of its economy. Its shipbuilding and maintenance industries also suffered but were able to continue for several more years.
In 1954 an 84 kilometre pipeline was completed between the town and Adelaide. In 1971 Mannum still had a population of 2043.
The stern-wheeler Murray Princes, based at Mannum, now provides tourists with cruises along the river. It is Australia's largest and most luxuriously appointed paddlesteamer and cruises from Mannum each week on a 170 km journey upriver to Morgan. Built in 1986 it has a length of 67 metres, a beam of 15 metres and can provide for 128 passengers.