Wesley Chapel United Methodist Church traces its roots to the first Methodist congregation founded in New Albany. In October 1816, several settlers began meeting for prayers in a cake shop owned by Harriet Reynolds on the east side of Pearl Street. Reynolds, a devout woman recently arrived from New Jersey, sold “ginger cake and spruce beer” from a room in the front of the building and lived in the rear. The group gathered each Wednesday evening to pray, sing hymns, and celebrate their faith. Obadiah Childs soon organized a Methodist class that attracted additional members. Upon learning of these developments, circuit-riding preacher John Shrader traveled to New Albany to minister to the group. On June 20, 1817, Shrader held a service for twenty-four believers in the dining room of Hannah Ruff’s tavern. The group immediately decided to organize a Methodist society and build a church.

The following day, society members began construction of a simple building began at a site on Lafayette Street. On November 25, 1817, the congregation met in the structure for the first time. Shrader preached the sermon. Members unanimously agreed to name the church Wesley Chapel in honor of John Wesley, the co-founder of the Methodist faith. In 1827, the congregation moved to a new building at the corner of West First and Market streets. Since riverboat men frequented church at its new location, Wesley Chapel became known as the “old ship.” The first meeting of the Indiana Conference of the Methodist Episcopal Church took place at the church in 1832. Members built the New Albany Methodist Seminary on an adjoining lot in 1835. It operated until 1843, when debt led to its closing.

As Methodism grew rapidly during the 1830s and 1840s, Wesley Chapel spawned two new churches. Following a revival in 1838 and 1839, a group of members established Centenary Methodist, which became an independent congregation in 1841. In 1850, more than 200 members left Wesley Chapel to found Robert’s Chapel, now Main Street United Methodist Church.

In 1854 Wesley Chapel erected a new building at 202 West Market Street. It served the congregation for more than a century. Wesley Chapel became embroiled in the debate over slavery a short while later. In 1856, the church appointed B. F. Crary as its minister. Subborn, uncompromising, and outspoken, Crary held strong abolitionist views. He published scathing letters attacking the Democratic Party for its position on slavery. Since the shipbuilding industry produced the bulk of New Albany’s wealth and demand for new ships came from the slaveholding south, Crary’s ideas proved unpopular, which to his departure from Wesley Chapel in 1857.

Wesley Chapel met at 202 West Market Street for the last time on June 7, 1964. The congregation then relocated to a building at 2212 State Street. In 2013, the congregation moved to a new building off U.S. Highway 150 in Floyds Knobs. The church maintains two campuses, with a second location on Grant Line Road.