Dallas Sonnier grew up in Highland Park, in Dallas, went to USC film school, and co-founded the Los Angeles management company Caliber Media. He produced Bone Tomahawk, a 2015 western from writer-director S. Craig Zahler. He moved back to Dallas around 2015. In 2016 he met Will Evans, the publisher of Deep Vellum Books, intending to invest in Evans's bookstore. After three meetings, the two agreed to start a company instead. In November 2016 the Dallas Observer reported their plan for Cinestate. It would develop books, films and radio-drama-style audio from the same stories and would be, in the paper's words, the first movie studio in Dallas.
The company made low-budget genre films with local crews. The Hollywood Reporter wrote in 2019 that Bone Tomahawk and Zahler's Brawl in Cell Block 99, starring Vince Vaughn, had both made a profit. The paper reported that the next film, Zahler's Dragged Across Concrete with Mel Gibson, cost $15 million, while Henry Dunham's The Standoff at Sparrow Creek was shot in three weeks for under $500,000. Texas Film Commission records list Cinestate productions shot around Dallas, among them Puppet Master: The Littlest Reich, Satanic Panic, VFW, Run Hide Fight, The Seventh Day and South of Heaven. A Cinestate company was paid a state incentive grant for Till Death, which reported 202 Texas jobs. In 2018 Sonnier relaunched Fangoria, the horror magazine. D Magazine wrote in 2020 that Cinestate had essentially become the Dallas film scene, shooting seven North Texas films in five years.
In 2020 the company faced a crisis. In the spring, Dallas producer Adam Donaghey was arrested on a charge of sexual assault of a child. D Magazine reported that Donaghey had worked on every Cinestate film shot in Dallas since 2017. The Daily Beast then published a story alleging sexual misconduct and unsafe conditions on Cinestate sets, and D Magazine reported similar accounts from crew members. Sonnier told D Magazine that no formal complaints had been filed. He said he was working with entertainment and labor lawyers on new policies, and he argued that a small group of critics had personal grievances against the company.
In August 2020, Fangoria and its archive were sold to Wanderwall Entertainment's Tara Ansley and entrepreneur Abhi Goel. In January 2021 Deadline reported that The Daily Wire would distribute Run Hide Fight, produced by Sonnier and Amanda Presmyk, and that Sonnier was launching a new banner, Bonfire Legend.