In January, 1908, Rev. Francis Hess, pastor of St. Joseph Parish in Waterloo, began to organize the forming of a parish in the community of Marshall, approximately five miles to the west of Waterloo. The existing Baptist church on South Beebe Street, which had been vacated years earlier, was purchased for the church's beginning. After the founding of the parish of St. Mary of the Nativity, it became a mission of St. Joseph, and was served by Fr. Hess for approximately two years.
In 1910, St. Mary received its first resident pastor. Fr. Christian Nellen served the parish for 28 years. Under his leadership, the parish constructed the present building, which was dedicated in 1921.
In 1981, under the leadership of Rev. Archie Adams, a new catechetical center and parish hall was constructed to the south of the parish building proper. The new building was joined to the church via an entryway that was accessible from both the east and west sides of the property. Handicap access was also added at this time.
In 2002, the parishes of St. Joseph and St. Mary of the Nativity in Marshall were linked. While the parishes remained separate entites, many resources (including pastoral leadership) were shared between both parishes. 2005 would bring a big celebration to the parish and school of St. Joseph, as students, parents, alumni and parishioners celebrated 100 years of Catholic education.
In 2009, plans were made to merge the parishes of St. Joseph and St. Mary of the Nativity into one parish family. The merger was completed on July 1, 2012. Holy Family now has two campuses, and continues in its mission of evangelization by it continued support of the parish school.