In 1890 industrialist W.R. Rust established Tacoma Smelting & Refining Company and a company town for his employees, naming the place "Smelter". On October 22, 1906, residents voted to change to the name to Ruston, in honor of Mr. Rust.
Ruston was officially incorporated on November 10, 1906 with a population of about 700. By 1920, the population had grown to over 1,120 for the first time.
The primary industry for decades was the ASARCO copper smelting plant on the waterfront. The smelter and its landmark smokestack, however, were demolished in 1993. A massive Superfund cleanup at the site has been underway since the early 1990s. This area has been renamed "Point Ruston", as a large residential and commercial center on the waterfront is under construction as of 2017, which could add over 1,000 residents to the city.
The Ruston town council passed a measure to become a noncharter code city under Washington law in late 2012. Officials indicated that the "Town of Ruston" moniker will continue to be used, however.
According to the United States Census Bureau, the town has a total area of 0.34 square miles (0.88 km2), of which, 0.26 square miles (0.67 km2) is land and 0.08 square miles (0.21 km2) is water.