Madrid was once wholely owned by a coal company. The area was booming in the 1800's. The mine supplied coal for the Santa Fe Railroad, the US Government, and local mines and people. In the 1930's, the company town was famous for its Fourth of July parade,
lighted Christmas displays and minor league baseball games in the first lighted stadium in the west. It is close to the famous Ortiz Mountains' gold mine and the historical Cerillos turquoise mine. Madrid, pronounced "MAD-dred," is ~25 miles south of Santa Fe on State Highway 14, the Turquoise Trail. It is ~55 miles from Albuquerque.
With the switch to an oil-based economy, the town died. As I understand it, in the 1950's the company tried to sell the whole town in one piece for $250,000 with no success. After breaking it up into smaller lots, evidently everything sold in a few days. The artists started arriving in the 1970's. Now many of the old buildings are restored and made into art galleries and arts & crafts shops. The original tavern is still in business. The old engine house is now a melodrama theater.
Madrid will probably never be very big. The aquifer is not good and there is a lack of potable water. Madrid is no longer the secret it used to be. Plenty of tourists from Santa Fe are found there in the summer with the corresponding impact on prices. However, it is a charming, peaceful place to visit in the off-season.