Colorado's earliest inhabitants were the Basket Makers, Native Americans who settled in the mesa country before the beginning of the Christian era. Later people known as cliff dwellers inhabited the area, building their pueblos in canyon walls.
The first European to enter the region was probably the Spanish conquistador Francisco Vásquez de Coronado in the 16th cent. Spain subsequently claimed (1706) the territory, although no Spanish settlements were established there. Part of the area was also claimed for France as part of the Louisiana Territory. At the end of the French and Indian Wars (1763), France secretly ceded the Louisiana Territory, including much of Colorado, to Spain. The French regained the whole area in 1800 by the secret Treaty of San Ildefonso concluded with Spain (see San Ildefonso, Treaty of).
The United States bought the area N of the Arkansas River and E of the Rocky Mts. in the Louisiana Purchase of 1803. The federal government sent expeditions to Colorado which generated some public interest in the new territory, and they explored routes opened earlier by the famous mountain men, trappers, and fur traders who included William H. Ashley, James Bridger, Jedediah S. Smith, Kit Carson, and the Bent brothers. Bent's Fort, in Colorado, was one of the best-known Western trading posts. Settlement in the area did not begin, however, until the United States acquired the remainder of present-day Colorado from Mexico by the Treaty of Guadalupe Hidalgo in 1848.
In the early 1800s a small farming settlement had been established in the San Luis valley, but most settlers pushing westward across the Great Plains continued on to the more fertile lands of Oregon, Washington, and California. It was the discovery of gold that first brought large numbers of settlers to Colorado. Prospectors led by Green Russell discovered gold in 1858 at Cherry Creek, where part of the city of Denver now stands, and after another strike the following year, the mining boom began.
At the time of the gold rush the area in which the gold fields were located was part of the U.S. Kansas Territory. A group of miners organized the gold fields as Arapahoe co. of Kansas Territory. The region was divided into districts, and miners' and people's courts were set up to provide quick justice. The miners sought separate territorial status in 1859 and formed the illegal Territory of Jefferson, which operated until the bill for territorial status was passed by Congress in 1861. William Gilpin, the first territorial governor, chose the name Colorado [Span., = red or colored]. Measures proposing statehood for Colorado were introduced in the U.S. Congress in 1864, and again in 1866 and 1867 when they were vetoed by Andrew Johnson. A bill granting Colorado's statehood was finally passed by Congress in 1876.
When the first settlers came to Colorado, the Ute lived in the mountain areas, while the Comanche, Cheyenne, Arapaho, and Kiowa inhabited the Great Plains. Warfare between plains and mountain ethnic groups was continuous. The tribes of the plains combined their forces in 1840 to halt the invasion of their homelands and hunting grounds by settlers, and violence ensued. The warfare finally culminated in the Native Americans' defeat after the Indian Wars (1861–69) and the Buffalo War (1873–74). Colorado's Native Americans now live mainly on the Southern Ute reservation and in the Denver area.
While Colorado was seeking to establish a government and engaged in conflict with Native Americans, the state's mining boom was in sharp decline. The surface gold had been extracted in the middle 1860s, and mining areas became, and in many cases remain, studded with ghost towns—machinery abandoned and shacks deserted. Other towns, such as Central City with its famous opera house dating from the city's days of opulence, managed to stay alive.
The completion (1870) of a railroad link from Denver to the Union Pacific in Cheyenne, Wyo., and later railroad construction helped to stimulate the extension of farming and the growth of huge cattle ranches as well as to encourage an influx of settlers. Between 1870 and 1880 population increased almost fivefold. Denver briefly became the largest receiving market for sheep, and a smelting industry was established.
In the 1870s the discovery of silver-bearing lead carbonite ore at Leadville started a new mining boom. Prosperity was short-lived, however, for in the 1890s, despite a rich silver strike at Creede and the discovery of the state's richest gold field at Cripple Creek, Colorado suffered a depression. In 1893 the U.S. government stopped buying silver in order to restore confidence in the nation's currency, which had been placed on the gold standard in 1873. The silver market subsequently collapsed, dealing a severe blow to Colorado's economy.
Labor conflicts, disputes over railway franchises, and warfare between sheep and cattle interests also plagued the state at the turn of the century. Many of labor's battles in this period were fought in the mines of Colorado, and the lawlessness and ruthlessness that prevailed among both employers and miners were reminiscent of the early days of the mining camps. When the silver market broke, Colorado turned politically to fusion Populist-Democratic leaders advocating a return to bimetallism. The free-silver movement, however, was unsuccessful, and by 1910, with the improvement of national economic conditions, Colorado settled down to a predominantly agricultural economy.
Large national parks, established in the early 1900s, have provided a continuing source of revenue; tourism has grown steadily. During World War I the price of silver soared again and the economy prospered. The stock-market crash of 1929 and the droughts of 1935 and 1937 brought hardships, but the economy recovered again during World War II, when the state's foods, minerals, and metal products were important to the war effort.
In the mid-1960s Colorado experienced a large influx of new residents and rapid urban growth and development, especially along a strip (c.150 mi/240 km long) centered on Denver and stretching from Fort Collins and Greeley in the north to Pueblo in the south. This growth, combined with the area's high altitude, caused pollution problems, most notably smog. The discovery and exploitation of oil created a boom in the 1970s, which collapsed in the early 1980s. Diversifying industry, swelling in-migration and accompanying construction, and tourism and recreation have since enabled Colorado to rebound, and between 1990 and 2000 it had the third largest percentage of growth of any state in the union.