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A vast territory that rejected foreign rule to become an independent nation, Texas has always played a starring role in the romance of the American West. So it's only fitting that Texas's capital should spring, full-blown, from the imagination of a man on a buffalo hunt.

A Capital Dilemma

The man was Mirabeau Buonaparte Lamar, who had earned a reputation for bravery in Texas's struggle for independence from Mexico. In 1838, Lamar was vice president of the 2-year-old Republic of Texas, and Sam Houston, the even more renowned hero of the Battle of San Jacinto, was president. Although they shared a strong will, the two men had very different ideas about the future of the republic. Houston tended to look eastward, toward union with the United States, while Lamar saw independence as the first step to establishing an empire that would stretch to the Pacific.

That year, an adventurer named Jacob Harrell set up a camp called Waterloo at the western edge of the frontier. Lying on the northern banks of Texas's Colorado River (not to be confused with the larger waterway up north), it was nestled against a series of gentle hills. Some 100 years earlier, the Franciscans had established a temporary mission here. In the 1820s, Stephen F. Austin, Texas's earliest and greatest land developer, had the area surveyed for the smaller of the two colonies he was to establish on Mexican territory.

But the place had otherwise seen few Anglos before Harrell arrived. The natural springs in the area had attracted various Indian tribes, including the Comanche, Lipan Apaches, and Tonkawas, but none settled there. Thus, it was to a rather pristine spot that, in the autumn of 1838, Harrell invited his friend Mirabeau Lamar to take part in a shooting expedition. The buffalo hunt proved extremely successful, and when Lamar gazed at the rolling, wooded land surrounding Waterloo, he thought it was an ideal place to settle.

In December of the same year, Lamar became president of the Republic. He ordered the congressional commission that had been charged with the task of selecting a site for a permanent capital to check out Waterloo. This news was not well received by the residents of Houston, who were hoping to keep their city as the republic's capital. They argued that Waterloo was a dangerous and inconvenient outpost unsuitable for being a capital. The commission was made up of those who wanted to push Texas's westward expansion, and thought that moving the capital to the west would help this endeavor, so it recommended Lamar's pet site.

In early 1839, Lamar's friend Edwin Waller was dispatched to lay out a new capital city to be named in honor of Stephen F. Austin -- the only one in the United States besides Washington, D.C., designed to be an independent nation's capital. The first public lots went on sale on August 1, 1839, and by November of that year, Austin was ready to host its first session of Congress.

Austin's position as capital was far from entrenched, however. Attacks from the republic by Mexico in 1842 gave Sam Houston, now president again, sufficient excuse to order the national archives to be relocated out of remote Austin. Resistant Austinites greeted the 26 armed men who came to repossess the historic papers with a cannon. After a struggle, the men returned empty-handed, and Houston abandoned his plan, thus ceding to Austin the victory in what came to be called the Archive War.

Although Austin won this skirmish, it was losing a larger battle for existence. President Houston refused to convene the Congress in Austin. By 1843, Austin's population had dropped down to 200 and its buildings lay in disrepair. Help came in the person of Anson Jones, who succeeded to the presidency in 1844. The constitutional convention he called in 1845 not only approved Texas's annexation to the United States, but also named Austin the capital until 1850, when voters of what was now the state of Texas would choose their governmental seat for the next 20 years. In 1850, Austin campaigned hard for the position and won by a landslide.

A Capital Solution

Austin thrived under the protection of the U.S. Army. The first permanent buildings to go up during the 1850s construction boom following statehood included an impressive limestone capitol, which no long exists. But two of the buildings in its complex, the General Land Office and the Governor's Mansion, are still standing today.

The boom was short-lived, however. Although Austin's Travis County voted against secession, Texas decided to join the Confederacy in 1861. By 1865, Union army units -- including one led by General George Armstrong Custer -- were sent to restore order in a defeated and looted Austin.

But once again Austin rebounded. With the arrival of the railroad in 1871, the city's recovery was secured. The following year Austin won election as state capital.

Still, there were more battles for status to be fought. Back in 1839, the Republic of Texas had declared its intention to build a "university of the first class," and in 1876, a new state constitution mandated its establishment. Through yet another bout of heavy electioneering, Austin won the right to establish the flagship of Texas's higher educational system on its soil. In 1883, the classrooms not yet completed, the first 221 members of what is now a student body of more than 50,000 met the eight instructors of the University of Texas.

The university wasn't the only Austin institution without permanent quarters that year. The old limestone capitol had burned in 1881, and a new, much larger home for the legislature was being built. In 1888, after a series of mishaps, the current capitol was completed. The grand red-granite edifice towering above the city symbolized Austin's arrival.

Dams, Oil & Microchips

The new capitol notwithstanding, the city was once again in a slump. Although some believed that quality of life would be sacrificed to growth -- a view still widely held today -- most townspeople embraced the idea of harnessing the fast-flowing waters of the Colorado River as the solution to Austin's economic woes. A dam, they thought, would not only provide a cheap source of electricity for residents, but also supply power for irrigation and new factories. Dedicated in 1893, the Austin Dam did indeed fulfill these goals -- but only temporarily. The energy source proved to be limited, and when torrential rains pelted the city in April 1900, Austin's dreams came crashing down with its dam.

Another dam, attempted in 1915, was never finished. It wasn't until the late 1930s that a permanent solution to the water power problem was found. The successful plea to President Roosevelt for federal funds on the part of young Lyndon Johnson, the newly elected representative from Austin's 10th Congressional District, was crucial to the construction of six dams along the lower Colorado River. These dams not only afforded Austin and central Texas all the hydroelectric power and drinking water they needed, but also created the seven Highland Lakes -- aesthetically appealing and a great source of recreational revenue.

Still, Austin might have remained a backwater capital seat abutting a beautiful lake had it not been for the discovery of oil on University of Texas (UT) land in 1923. The huge amounts of money that subsequently flowed into the Permanent University Fund -- worth some $4 billion today -- enabled Austin's campus to become truly first class. While most of the country was cutting back during the Depression, UT went on a building binge and began hiring a faculty as impressive as the new halls in which they were to hold forth.

The indirect effects of the oil bonus reached far beyond College Hill. In 1955, UT scientists and engineers founded Tracor, the first of Austin's more than 250 high-tech companies. Lured by the city's natural attractions and its access to a growing bank of young brainpower, many outside companies soon arrived: IBM (1967), Texas Instruments (1968), and Motorola's Semiconductor Products Section (1974). In the 1980s, two huge computer consortiums, MCC and SEMATECH, opted to make Austin their home. And wunderkind Michael Dell, who started out selling computers from his dorm room at UT in 1984 and is now the CEO of the hugely successful Austin-based Dell Computer Corporation, spawned a new breed of local "Dellionaires" by rewarding his employees with company stock.

Willie Nelson's return to Austin from Nashville in 1972 didn't have quite as profound an effect on the economy, but it certainly had one on the city's live-music scene. Hippies and country-and-western fans could now find common ground at the many clubs that began to sprout up along downtown's Sixth Street, which had largely been abandoned. These music venues, combined with the construction that followed in the wake of the city's high-tech success, helped spur a general downtown resurgence.

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