Brew ha-ha: the joke is on our small business of the year its success attracts so much competition that it has to grow bigger just to stay viable.

• Author: Martin, Edward

Out back where summer visitors in lawn chairs listened to live music with brews in hand, fall fades the last of the color from the mountains of east Asheville. Inside, where stainless-steel tanks dwarf workers, conveyor lines shuttle brown cartons marked Gaelic Ale and shrink-wrapped pallets of beer await shipping, the office phones at Highland Brewing Co. start ringing this time of year. "When will the Cold Mountain Winter Ale be released?" the eager ask. That makes Oscar Wong proud. At 74, he's a man of dry wit who laughs easily and often. Favorite saying? "In wine there is wisdom, in beer there is strength. In water there is bacteria." But beer is serious business here.

In a cubicle the size of a closet, a staffer sips, take notes, then passes a brew through a portal to a counterpart on the other side. This is a blind testing. "Is it the right color, the right aroma? Some should be very pale, some amber, some brown, some black," Eric Jorgenson, quality assurance manager, says. "The whole idea is consistency." In a lab down a hallway, a device Wong describes as "about the size of two 12-packs stacked on each other" samples bottles pulled at random from production for carbon dioxide and oxygen content, alcohol level and other factors. "That one was a shocker," he says of the machine. "It cost us about $65,000." Amid a mad-scientist setting of tanks and other apparatuses, brewmaster John Lyda stirs a steaming kettle fired by a gas burner, experimenting with a new recipe. "We call this the skunk works," Wong says. "Twenty beers for 20 years," Lyda announces, referring to the varieties they've introduced.

Since December 1994, Wong and crew have built Highland into North Carolina's largest homegrown brewer and the third-largest craft brewery in the Southeast. By year-end, its 44 full-time and 22 part-time employees--he added a dozen in the last year--will have made 40,000 barrels of beer for distribution in nine states. Revenue should top $10 million. But Highland has done more than wet a lot of whistles, which is why it's Business North Carolina's Small Business of the Year. "Oscar Wong started a whole new industry in western North Carolina," says N.C. Secretary of Commerce Sharon Decker, one of the judges in the annual competition sponsored by Winston-Salem-based BB&T Corp. The other judges were Dr. Roy Archambault, CEO of Wilmington-based Dry Corp LLC, last year's winner, and BNC Publisher Ben Kinney.

Asheville has been voted Beer City USA four times since 2009 in online polling by a national craft-beer organization. Cable network CNN...