Eventually, Bill returned to Bluff Springs where he hid out among the black populace in a small shantytown located down near the railroad tracks. Soon word of his whereabouts reached Sheriff Ed McMillan in Brewton, Alabama who gathered a posse and started out for the hovel. They hired a local Negro as a guide to lead them to the shanties located in a copse of oak trees about a half-mile north of the train station. On the dark night of July 3, 1895 McMillan was leading his posse into the trees when suddenly someone called out from the dark and ordered them to halt. Whether Bill was tipped off or just naturally watchful will never be known, but a man on the run will sometimes become a wild animal with the instincts to match.
In the meantime, McMillan had complied with the outlaw's request and had ordered the posse to halt when two shots rang out and the 40-year old sheriff fell mortally wounded from his horse. Guns were drawn and men began to take cover, but there were no more shots forthcoming. The posse looked around for Bill, but he had disappeared into the night and it was too dangerous trying to pursue him in the dark. They picked up the sheriff and carried him into town where he died within several hours. The next morning a huge posse was organized, but the subsequent manhunt revealed nary a trace of Railroad Bill. Sadly, the Negro guide was arrested for conspiracy, but the law was forced to release him soon afterwards since there was absolutely no proof of any involvement on his part.