Claude, the seat of Armstrong County in the Texas Panhandle, got its theater on October 8, 1915, when the Claudia Theatre opened, according to Cinema Treasures. The Claudia began with live performances and later turned to films. Over the years it was renamed the Rialto and then the New Rialto before taking its current name, the Gem.
In May 1962 the Paramount Pictures production that became Hud came to town. The AFI Catalog reports that the company arrived in Claude, just outside Amarillo, for several days of rehearsal and began principal photography there on May 21, 1962. Martin Ritt directed the film from Larry McMurtry's 1961 novel Horseman, Pass By, starring Paul Newman, Melvyn Douglas and Patricia Neal, with James Wong Howe as cinematographer. The Gem appears in a scene the Texas Film Commission describes on its Texas Westerns Film Trail: after learning that his cattle may be in danger, Homer Bannon, played by Melvyn Douglas, takes his grandson Lonnie, played by Brandon De Wilde, into town to the Gem to catch a movie. An animated short called Clementine plays, and the two sing along to "Oh My Darlin' Clementine." Hud won three Academy Awards, for Patricia Neal, Melvyn Douglas and Howe's cinematography. The Handbook of Texas notes that Hud was one of three motion pictures filmed in Claude, which gave the small town a reputation in the movie industry.
The Armstrong County Museum bought the building in 1992, restored it and revived the Gem name. Cinema Treasures describes a small house of about 120 seats with a Pueblo Deco front: a starburst design over an open exterior lobby, a restored center box office and red velvet stage drapes. The theater is now part of the museum's complex of buildings on Trice Street. The Texas Historical Commission's heritage-travel guide says the Gem keeps an exhibit of vintage movie memorabilia and regularly hosts live performances by local and touring theater and music groups, and it calls the building a Texas Historical Site in recognition of its role in Hud.