Eastern portions of the highway that are currently designated as SD 240 (generally from the park headquarters to Cactus Flat) were originally part of the original alignment of
SD 40. Construction began in the early 1930s. By 1944, a gravel surface was on the Badlands Loop alignment, and by the late 1940s, the Badlands Loop was signed as
U.S. Route 16 Alternate (US 16 Alt.), in addition to SD 40 along the eastern portion of the loop. These two numbers were used until the early 1970s, when the SD 40 number was replaced by an extension of
SD 44 (which entered the park from the southeast rather than the northeast). Around 1980,
US 16, which traveled
concurrently with I-90, was truncated at its eastern end to
Rapid City. Since US 16 Alt. no longer met the parent route, the route number was changed to SD 240. ==Major intersections==