Until then cigarettes had been rolled by hand. Readymade cigarettes were a luxury item, but became increasingly popular. The slow manual fabrication process—a skilled cigarette roller could produce only about four cigarettes per minute on the average—was insufficient to satisfy the demands in the 1870s. In 1875, the Allan & Ginter company in Richmond, Virginia offered a prize of US$ 75,000 for the invention of a machine able to roll cigarettes. Bonsack took up the challenge and left school to devote his time to build such a machine. In 1880, he had a first working prototype, which was unfortunately destroyed by a fire while in storage at Lynchburg, Virginia. Bonsack re-built it and filed a patent application on September 4, 1880. The patent was granted the following year (U.S. patents 238,640 from March 8 1881 and 247,795 from October 4 1881). Bonsack's machine was able to produce 120,000 cigarettes in ten hours, revolutionizing the cigarette industry.
The census-designated place (CDP) of Bonsack, Virginia, located in Roanoke County, was name after James Bonsack, who lived in this town located along route 460 between Roanoke and Bedford.