In 1862, President Abraham Lincoln established the Homestead Act. This act entitled U.S. citizens to "settle" up to 160 acres of federally owned land by paying a small filing fee and working the land for five years, after which time ownership would revert to the homesteader. This act enabled Minnesota to grow substantially; over 10,000 homestead entries were recorded in Minnesota while the act remained in effect.
The second federal land grant program, the Timber Culture Act of 1873, gave an additional 160 acres of land to individuals who planted trees on one-fourth of their homesteaded property. The Homestead Act was not repealed until 1976; the Timber Culture Act came to an end in 1891.
The Morrill Act was created in 1862 to provide land grants to states in order to establish colleges, specifically for the benefit of agriculture and mechanical arts. The funding was focused primarily on rural areas and such courses as agriculture, military arts and home economics. Each state was eligible to receive 30,000 acres of federal land for each congressional representative, which gave Minnesota 120,000 acres.
The state sold the land and used the proceeds to fund public colleges. In 1867, the University of Minnesota, one of 105 U.S. land grant colleges, used the funds to reopen the college; it had been forced to close during the Civil War due to lack of funds.
A series of U.S. congressional railroad land grants, beginning in 1850 and continuing through the end of the 19th century, initially gave 3,840 acres of land to developers for each mile of railroad to be built. The U.S. Congress gave the Minnesota and Northwestern Railroad Co. a 30,000-acre land grant by in 1854.
In 1857, this railroad was rechartered as the Minnesota and Pacific Railroad and received an additional 5 million acres. But only 10 miles of railroad was built at that time, because of disagreement and corruption by state officials and private investors. The railroad was then renamed the St. Paul and Pacific and received over 3 million more acres from the state of Minnesota.
In 1873, James Hill, a Minnesota industrialist, purchased it and financed further expansion by selling homesteads for $2.50 an acre. In addition, he let immigrants coming through Minnesota travel on his railroad for $10 in exchange for settling there. Eventually this railroad became part of the Great Northern Railroad.