Before Brethren Woods, Camp Bethel (Fincastle, VA) was the only camp serving Brethren in the entire state of Virginia. This created a huge distance for people to travel in order to attend camp and it began to be more important to have camps closer to participants. About 1955, Camp Bethel and Brethren in this area began to talk about the need for camps in other places. Second District of VA and Northern District of VA (the two districts who later merged to form Shenandoah District), formed a committee to study the possibility for a camp here.  About 1958, the first 60 acres of land for Brethren Woods were purchased from the Pittington Family. The cost per acre was about $50. This property now forms the central part of camp, centered around the lake. At the time, there was a smaller lake and an old log cabin/house beside the lake was the only building. In this cabin, camp supporters found a copy of The Gospel Messenger and an old Brethren bonnet. Mt. Lodge was the first camp building constructed on the site in 1961, followed by the first pool (at the current basketball court!) in 1965 and Forest Haven A-Frame in 1966.

In addition to acquiring a campsite and beginning to improve it, two important values guided the camp committee. Sam Flora, who served as the District Executive for Second District of VA, relates that the first was "small group camping, having 8-10 campers with perhaps two leaders...explore Christian faith and life together in a different way." The second thing was to make a better use of the outdoors, so Brethren Woods chose a more rustic style of camping than had been experienced at Camp Bethel and other Brethren camps. Campers lived in covered wagons, tents, cabins, and tarp-covered hogans.

According to the first camp manager, Paul Hollinger, small group camping was different than anything kids had experienced before "because they had to do things for themselves that were usually done for them." In family groups, campers and staff established their campstie, cooked all their own meals, and planned many of their activities. This helped to make them "more self-reliant and they knew they could do it after that."