After the railway passed through what is now Bundanoon in 1868, settlement began to increase, and in 1877 a request was made to the Bishop for a minister to visit once a month. The first Holy Trinity Church at Bundanoon was erected with slab walls and shingle roof surmounted by three wooden crosses on one acre of land offered by Mr. W. A. Nicholas. It was consecrated on 9th November, 1879. The building was subsequently burnt down in the disastrous bushfires of December 1904.
On 8th March, 1905 His Excellency Sir Harry Rawson laid the foundation stone of the new stone church built by Mr. J.W.R. Walker of Kareela. Stonework was done by Mr. T. Shepherd and Son from Bowral, and the windowsills dressed by G.W. Layton of Penrose. The sandstone came from near a coalmine halfway between Bundanoon and Penrose. The hardwood was supplied by Joe Tooth, who had a sawmill in the Bundanoon Gully.
Three beautiful windows adorn the east end of the building. One window shows the Holy Spirit as a dove descending, another the Lamb of God with a banner of love and together they flank the lovely central window with its colourful IHS and seven blue orbs. The building was consecrated by Bishop Wright on 28th June, 1912. An historic cemetery is located behind the church. The earliest monument is to Amy Eliza Nicholas who died aged 11 years in 1880.