The town of Bannack was founded in 1862, when gold was discovered on Grasshopper Creek, and it didn't take long for prospectors and enterprising businessmen to flood in. The name "Bannack" came from a nearby tribe of Native Americans. Even though it was in a pretty remote part of Montana, bakeries, hotels, breweries, billiards halls, saloons, blacksmith shops, butchers, and more sprang up. Two short years later, the rapidly-growing city was named the territorial capital of Montana, before it became a state.