Abilene wholesale grocer H. O. Wooten financed the Paramount in 1928 to stand beside his Wooten Hotel, an 18-story building the theater's own history calls West Texas' first modern skyscraper. Local architect David S. Castle designed the theater, which cost $100,000. Its plain brick front, topped by polychrome terra cotta plaques, gives no hint of the auditorium inside: an atmospheric room built to look like a Spanish-Moorish courtyard at night, with projected clouds drifting across a ceiling of twinkling stars.
The Paramount opened in May 1930 with a sold-out showing of Safety in Numbers, starring Charles "Buddy" Rogers and Carole Lombard. The theater's site and Cinema Treasures give the date as May 19. Its National Register nomination says thousands of people traveled to Abilene in the 1930s for its films and stage shows, and that it was said to be the first air-conditioned building in town. For many years it was part of the Interstate chain under manager Wally Akin, whose Saturday-morning birthday club took milk bottle caps as admission. During World War II it was a regular stop for soldiers from Camp Barkley.
As downtown traffic thinned, the Paramount closed in the mid-1970s, the first time it had gone dark since 1930. In October 1979 the Wooten family sold it to the Wooten Investment Co., which leased it to the Paramount Opry, a country music venue that added dressing rooms and moved the concessions to the basement. The Abilene Preservation League bought the building on December 31, 1980, and its Paramount Committee won a listing on the National Register of Historic Places on December 27, 1982. Cinema Treasures reports that the theater was again slated for demolition in 1984 before an anonymous buyer stepped in to pay for its restoration.
San Antonio architect Killis Almond led the restoration, and the Paramount had its grand reopening on May 21, 1987. The work won the Texas Historical Commission's Texas Award for Historic Preservation. Today the theater seats 1,131 and hosts concerts, ballet, opera and the Abilene Philharmonic, and films remain part of the schedule: the Paramount Film Series sells a 12-admission movie card, and since 2018 a Summer Family Film Series has offered $2 matinees.