The free homestead law has been called the most important act for the welfare of the people ever passed in the United States.

In 1852 a political group, called the Free Soil party, demanded free homesteads for the people. In 1854 the first free homestead bill was introduced in Congress by Congressman Galusha A. Grow of Pennsylvania. The people of the West and poor people everywhere were in favor of the bill; however, there was strong opposition to the bill.

The first Homestead Act required the settler to pay twenty-five cents an acre for his land and was passed in by Congress in 1860; however, the bill was vetoed by President Buchanan.

Homestead in Hunterstown, Indiana

It was not until May 20, 1862, that the free Homestead Act was finally passed and signed by President Abraham Lincoln. The law took effect on January 1, 1863.

Under this law any man or woman twenty-one years old or the head of a family could have 160 acres of undeveloped land by living on it five years and paying eighteen dollars in fees.  They were also required to build a home, make improvements and farm the land before they could own it outright.  Alternatively, the homesteader could purchase the land for $1.25 per acre after having lived on the land for six months.

The first claim under the Homestead Act was made by Daniel Freeman for a farm in Nebraska on January 1, 1863.  Today, Freeman’s homestead continues to stand as the Homestead National Monument near Beatrice, Nebraska. Freeman lived on and worked the land until his death on December 30, 1908.  His wife Agnes continued to live on the homestead until shortly before her death in 1931. In 1936, by an act of the United States Congress, the site of Freeman's homestead was recognized as the "first" homestead in the United States when it was designated the Homestead National Monument of America.

Settlers from all walks of life including newly arrived immigrants, farmers without land of their own from the East, single women and former slaves came to meet the requirements.

People interested in Homesteading first had to file their intentions at the nearest Land Office and after a check for any ownership claims, the prospector paid a filing fee of $10 to claim the land temporarily, as well as a $2 commission to the land agent.

When all requirements had been completed and the homesteader was ready the take legal possession, the homesteader found two neighbors or friends willing to vouch for the truth of his or her statements regarding land improvement and sign the "proof" document. 

After successful completion of this final form and payment of a $6 fee, the homesteader received the patent for the land, signed with the name of the current President of the United States. This paper was often proudly displayed on a cabin wall and represented the culmination of hard work and determination.

By the end of the 19th century, over 570 million acres remained open to settlement, but very little of this was usable for agriculture. As the Frontier moved west onto the arid Great Plains, the amount of land a homesteader was allowed to claim was increased to 640 acres.

In Wyoming , Montana, and Colorado homesteading cut into the access of the large ranches to the public domain where hundreds of thousands of cattle were grazed upon the open range, a practice called free grazing. The ranchers fought back by themselves (or their cowboys) homesteading prime spots which gave access to water. At times tensions escalated into violence, conflicts called range wars; for example, the Johnson County War in Wyoming.