This is the history of Blue Diamond Village. Blue Diamond is located 26 miles southwest of Las Vegas. The village, originally known as Cottonwood Springs, changed its name when the Blue Diamond Company took ownership of the Gypsum mine and built corporate housing for the workers in the early '20s. Near the base of the Red Rock canyon, Blue Diamond Village was originally a stop on the Old Spanish Trail for traders from Santa Fe, N.M., to California between 1830 and 1848, according to the history committee's findings.