The American Legion Dance went late and loud at Kennebunk Town Hall on March 18, 1920. After the revelers finally retreated, Miss Edna Hubbard, a house guest at the neighboring home of George and Sylvia Cousens, finally drifted off to sleep, but she was startled awake again at about 4:30 A.M. by the sound of shattering glass. Springing from her bed, she was astounded to see the lower level of Town Hall engulfed in flames. Her host, George Cousens dashed across to box 38 at the corner of Main and Fletcher Streets to sound the fire alarm to rouse Fire Chief Roberts while Edna woke the neighbors.

The firemen were handicapped by a malfunctioning pump at the water station and try as they might, they were unable to get enough water pressure to subdue the flames which had by then reached the top of Town Hall. They were able, however, to put out several smaller fires that had leapt to neighboring houses.

The fire destroyed many of the furnishings at Town Hall, including a large marble memorial tablet listing Kennebunk Civil War Veterans. The Memorial had been presented to the town by the Kennebunk Dramatic Club soon after the impressive brick Town Hall was built in 1867, to replace the former Washington Hall that had burned to the ground in 1866.

The cause of the 1920 fire was unknown. Some assumed that careless dancers had unsafely discarded lit cigarettes. It came to light in the weeks that followed the fire that the electrical lights had recently been blowing a lot of fuses. Some blamed the Selectmen for not attending to the situation with urgency by finding a qualified electrical inspector for the town.

Mr. Henry Parsons generously purchased the lot where the Kennebunk Town Hall now stands. J.D. Leland and Company Architects of Boston were hired to design the new building and it was officially opened on the new Parsons lot on May 30, 1922.