AT THE "pub in the scrub", no one is too worried about the rowdy behaviour of patrons after a few beers.

The locals all depend on each other too much to go fighting amongst themselves, according to publican Eddie O'Brien.

Eddie and his wife Tracy run the Menzies Hotel, also known as the pub in the scrub, at Dergholm northwest of Casterton.

Eddie said the business had defied the odds by growing, despite the drought and the expansion of blue-gum plantations that removed almost 30 farming families from the district.

Before taking over the pub, Eddie was principal of the Apsley primary school, but decided to pursue a lifelong dream of becoming a publican.

"I guess it helps that I like people. You get everyone coming in here, whether they are a labourer or a millionaire, and in place like this, everyone is totally equal," he said.

As its nickname suggests, the pub in the scrub is surrounded by numerous state parks.

Dergholm is a grazing district with sheep - traditionally for wool, but more recently for meat - and cattle the mainstays.

Timber industries have also played a role, with harvest of native timber, pines and more recently blue gums.

Eddie said there was a multi-faceted aspect to the hotel. It was far more than a bar, with a post office, a shop, petrol and meals.

Other than the pub, Dergholm has a church, a hall, and CFA shed.

"Those elements are really important for the community to have access to all these things, otherwise they would struggle to get their daily bread and milk," Eddie said. "The shop and post office also give people who do not drink and opportunity to call in and catch up with other locals."

Dergholm's first post office was opened in 1876, and there were two stores operating in the early 1870s.

The town's first pub, the Dergholm Inn, was built in 1880. It was rebuilt in 1921 by Captain Duncan Menzies, who served in World War I.

"One of the community's strengths is that there's a lot of second, third, and fourth-generation farming families, and they all depend on each other and have some very strong friendships," he said.

"And ... we're in the middle of five towns; we aren't a main tourist route, but increasingly people seek us out."

Eddie said the pub seemed to attract real characters, ranging from locals to travellers.

"We had a 35-foot (10.6m) yacht once, on its way to Melbourne for the Melbourne-Hobart race, from Perth, and they were pretty thirsty after a long drive," he said. "You just never know who is going to walk in the door, and that keeps things interesting."

Eddie said one of the pub's biggest challenges came last year in the form of increased costs.

The hotel's fire insurance levy rose dramatically and the annual licence fees were hiked from $795 to $2300, he said.

"It's made things difficult, and we're paying for the trouble in Melbourne and extra policing there," he said. "We've never had a problem here (with alcohol-fuelled violence).

"Locals look after each other, and they realise that people coming in from out of the area help to keep the place open, so they're always friendly.

"I've been in other pubs where that's not the case and people want strangers out because it's their place; but that's definitely not the case at Dergholm."