Native Americans known to have inhabited Montana at the time Europeans first explored it included the Blackfoot, the Sioux, the Shoshone, the Arapaho, the Kootenai, the Cheyenne, the Salish, and others. Exploration of the region began in earnest after most of Montana had passed to the United States under the Louisiana Purchase (1803). The Lewis and Clark expedition traveled westward across Montana in 1805, and François Antoine Laroque, along with his North West Company of Canada, explored the Yellowstone River after 1805.
The area's rivers were important avenues of travel for the native inhabitants as well as the early explorers of the country; the first trading post in Montana was established at the mouth of the Bighorn in 1807 by a trading expedition that Manuel Lisa led up the Missouri from St. Louis. For some years thereafter both Canadian and American fur traders continued to open up the territory. David Thompson of the North West Company built several trading posts in NW Montana between 1807 and 1812, and beaver in the mountain streams and lakes attracted adventurous trappers, the so-called mountain men. The American Fur Company, with its posts on the Missouri and the Yellowstone, dominated the later years of the region's fur trade, which diminished in the 1840s.
The U.S. claim to NW Montana, the area between the Rockies and the N Idaho border, was validated in the Oregon Treaty of 1846 with the British. Montana was then still a wilderness of forest and grass, with a few trading posts and some missions. Montana's first period of growth was the rapid, boisterous, and unstable expansion brought on by a gold rush. The discovery of gold, made initially in 1852, brought many people to mushrooming mining camps such as those at Bannack (1862) and Virginia City (1864). Crude shantytowns were built, complete with saloons and dance halls—ephemeral settlements as colorful as the earlier gold-rush camps in California and perhaps even more lawless.
Previously part of, successively, the territories of Oregon, Washington, Nebraska, Dakota, and Idaho, Montana itself became a territory in 1864. It was still a rough frontier, however, and the first governor, Sidney Edgerton, was driven out of the region; later Thomas Francis Meagher, appointed temporary governor, died mysteriously. After the Civil War the grasslands attracted ranchers, and in 1866 the first cattle were brought in from Texas over the Bozeman Trail, to the area east of the Bighorn Mts.
Yet it was not until after wars with the Sioux that ranching was safe. The Sioux did not tamely submit to having their lands taken from them; in 1876 at the battle of the Little Bighorn, they defeated Col. George A. Custer and his force in one of the greatest of Native American victories. The Sioux were eventually subdued, and the gallant attempt of Chief Joseph of the Nez Percé to lead his people into Canada to escape pursuing U.S. troops had its pitiful end in Montana.
Great ranches spread out across the plains, and cow towns that were to grow into cities such as Billings and Missoula sprang up as the railroads were built in the West (c.1880–c.1910). Statehood was achieved in 1889, and the building of the railroads put an end to the era of the open range.
Mining continued to dominate Montana's economy into the 20th cent. The discovery of silver at Butte (1875) was followed (c.1880) by discovery of copper at that same "richest hill on earth." The Amalgamated Copper Company (later renamed Anaconda Copper Mining Company) came to play a major role in Montana life. The titans of the mines, Marcus Daly and William A. Clark, contended bitterly for ownership of the mineral deposits and for political control, and their rivalry was fought out physically by the miners. F. Augustus Heinze also entered the scramble for copper riches, challenging the claims of Amalgamated Copper. Amalgamated prevailed and exercised enormous control over state affairs.
Struggles between the company and the workers led to strikes, disorder, and bloodshed, but also to the enactment of some early measures for social security, important because over the years the livelihood of mining town residents has depended on the fluctuating market price of copper. By the 1990s, however, mining was producing less than 10% of Montana's revenues, and such centers as Butte and Anaconda, where operations had shut down, had become shells of their former selves.
After the coming of the railroads, farmers arrived by the trainload to develop the lands of E Montana. They planted their fields in the second decade of the 20th cent. The initial bounteous wheat yield did not last long; the calamitous drought of 1919 and the consequent dust storms seared the fields, and in the 1920s the farms began to disappear as rapidly as they had been established.
When the Great Depression began in 1929, Montana was already accustomed to depression. In subsequent years vigorous measures were taken to aid agriculture in the state, and by the late 1940s federal dam and irrigation projects—on the Missouri, the Yellowstone, the Marias, the Sun, and elsewhere—opened many acres to cultivation. Some of the vast grazing lands were brought under planned use, and the development of hydroelectric power continued. Major multipurpose dams in Montana producing power include Fort Peck, Hungry Horse, and Canyon Ferry.
The demand for copper in World War II and the E Montana oil boom of the early 1950s stimulated the economy, but the state still faces high transportation costs, a worker shortage, and slowness in regulating resources. A gradual trend toward a more diversified economy has seen manufacturing grow in importance; tourism is also on the rise. Coal exploitation increased dramatically in the 1970s, somewhat offsetting the decline of metals mining. In 1997 legislation was passed that aimed to attract foreign money by making the state an offshore banking haven.