Shortages of food during the gold rush led enterprising pioneers to initiate a new and significant component to the regional economy. Water was diverted from the streams to irrigate the land in what has been called the single most significant event in Colorado history. An entirely new social code and economy and a Western water law—drawing on elements of English common law and Spanish statutes alike—evolved in a time of conflict between livestock herders and farmers. The industries and inhabitants of cities and towns came to depend upon irrigation agriculture. Sugar factories, which extracted the juice from the sugar beet, sprang up across the landscape.

By 1881 the buffalo herds on Colorado’s plains had been replaced by cattle and sheep. From its mountain valleys, plains, and feedlots, Colorado became a major producer of meat. Automobiles, railroads, and a tunnel through the mountainous backbone united the mountains and high plateaus of western Colorado with the flat eastern portion of the state, and the flow of resources set the pace for industrial development. Also in the 1880s, steel was first produced in Pueblo, based on local deposits of iron ore and coal, and Pueblo became a major producer of metals. Drought and the Great Depression of the 1930s triggered rural emigration but also spurred the construction of a large-scale transmountain water-diversion project.

World War II and after

Fear of enemy attack on both U.S. coasts during World War II stimulated the development of government facilities in Colorado because of its interior, yet accessible, location. In 1942 Japanese Americans from the West Coast were interned at Camp Amache, near the high-plains farming town of Granada. The Denver Federal Center, Rocky Mountain Arsenal, Camp (later Fort) Carson, Camp Hale, and other government and military installations attracted thousands of newcomers to the state. By the late 1940s the state was second only to Washington, D.C., in number of federal government offices, almost all of which had administrative jurisdiction beyond the state borders.

The federal presence in Colorado grew increasingly during the Cold War era. The U.S. Air Force Academy, founded as the service’s chief officer-training school in 1954, relocated from Denver to Colorado Springs in 1958. Peterson Air Force Base—the communications and administrative headquarters for the North American Aerospace Defense Command (formerly North American Air Defense Command) and the U.S. Space Command—and the Pueblo (Army) Chemical Depot, a major repository of chemical weapons and wastes, also moved to the area. Civilian offices of federal agencies—including the Department of Agriculture, the Fish and Wildlife Service, the Bureau of Land Management, the Department of Treasury, the Department of Energy, and the National Oceanic and Atmospheric Administration—were also established in Colorado, almost entirely in Front Range urban centres.

Colorado’s post-World War II economy was fueled by newcomers who embraced the state’s capacity to develop ski resorts and additional outdoor-sports facilities. In the 1950s Colorado began to grow as a centre of electronic and, later, high-technology manufacturing. The diversification and strengthening of the Colorado economy brought an influx of newcomers, and by the 1980s some three-fifths of the state’s population had been born outside Colorado. Tourism soon became an economic mainstay, while official state policy promoted orderly growth of the economy and the infrastructure to support it. The rapid growth of technological industries continued in the last two decades of the 20th century but slowed in the early 21st century. In the late 1990s the Front Range communities remained among the fastest-growing regions in the country in terms of both population and economic expansion; the economy slowed by the following decade, but the population growth rate was higher than in the country overall. In the 1990s members of several tribes that were relocated in the 1870s following the Sand Creek Massacre sought restitution for the loss of ancestral lands; the Bureau of Indian Affairs, the Colorado legislature, and other entities issued formal apologies, but no monetary compensation was provided. In 2007 the U.S. Department of the Interior established the Sand Creek Massacre National Historic Site in order to preserve the site and commemorate and interpret the event.