During the colonial period, land that would become the Southwest Territory was part of
North Carolina's
land patent. The
Blue Ridge Mountains, which rise along the modern Tennessee-North Carolina border, hindered North Carolina from pursuing any lasting interest in the territory. Initially trade, political interest, and settlement came mostly from
Virginia and
South Carolina, though refugees from the
Regulator War began arriving from North Carolina in the early 1770s. The
Watauga Association was a semi-autonomous government created in 1772 by frontier settlers living along the
Watauga River in what is present day
Elizabethton, Tennessee. The colony was established on
Cherokee-owned land in which the Watauga and Nolichucky settlers had negotiated a 10-year lease directly with the Indians.
Fort Watauga was established on the Watauga River at
Sycamore Shoals as a trade center of the settlements. In March 1775, land speculator and North Carolina judge
Richard Henderson met with more than 1,200 Cherokees at Sycamore Shoals. Included at the gathering were Cherokee leaders such as
Attacullaculla,
Oconostota, and
Dragging Canoe. The meeting resulted in the "
Treaty of Sycamore Shoals", in which Henderson purchased from the Cherokee all the land situated south of the
Ohio River and lying between the
Cumberland River, the
Cumberland Mountains, and the
Kentucky River. This land, which encompassed roughly 20 million acres (80,000 km2), became known as the
Transylvania Purchase. Henderson's land deal was found to be in violation of North Carolina and Virginia law, as well as the
Royal Proclamation of 1763, which had prohibited the private purchase of
American Indian land. Both North Carolina and Virginia considered the trans-Appalachian settlements illegal, and refused to annex them. Nevertheless, at the onset of the
American War for Independence in 1776, the settlers, who vigorously supported the Patriot cause, organized themselves into the "Washington District" and formed a
committee of safety to govern it. In July 1776, Dragging Canoe and the faction of the Cherokee opposed to the Transylvania Purchase (later called the
Chickamaugas) aligned with the British and launched an invasion of the Watauga settlements, targeting
Fort Watauga at modern Elizabethton and Eaton's Station near modern
Kingsport. After the settlers thwarted the attacks, North Carolina agreed to annex the settlements as the
Washington District. In September 1780, a large group of trans-Appalachian settlers, led by
William Campbell,
John Sevier and
Isaac Shelby, assembled at Sycamore Shoals in response to a British threat to attack frontier settlements. Known as the
Overmountain Men, the settlers marched across the mountains to South Carolina, where they engaged and defeated a
loyalist force led by
Patrick Ferguson at the
Battle of Kings Mountain. Overmountain Men would also take part in the
Battle of Musgrove Mill and the
Battle of Cowpens. In 1784, North Carolina ceded control of the Overmountain settlements following a hotly contested vote. The cession was rescinded later that year, but not before some of the settlers had organized the
State of Franklin, which sought statehood.
John Sevier was named governor and the area began operating as an independent state not recognized by the
Congress of the Confederation. Many Overmountain settlers, led by
John Tipton, remained loyal to North Carolina, and frequently quarreled with the Franklinites. Following Tipton's defeat of Sevier at the "Battle of Franklin" in early 1788, the State of Franklin movement declined. The Franklinites had agreed to rejoin North Carolina by early 1789. ==Territory formation==