Transylvania Colony

The Transylvania Colony, also referred to as the Transylvania Purchase or the Henderson Purchase, was a short-lived, extra-legal colony founded in early 1775 by North Carolina land speculator Richard Henderson, who formed and controlled the Transylvania Company. Henderson and his investors had reached an agreement to purchase a vast tract of Cherokee lands west of the southern and central Appalachian Mountains through the acceptance of the Treaty of Sycamore Shoals with most leading Cherokee chieftains then controlling these lands. In exchange for the land the tribes received goods worth, according to the estimates of some scholars, about 10,000 British pounds ($1.5 million U.S. in 2016). To further complicate matters, this frontier land was also claimed by the Virginia Colony (particularly following Lord Dunmore's War) and a southern portion by Province of North Carolina.

The Transylvania Colony was located in what is now the central and western parts of Kentucky, and a chunk of north central Tennessee. The American pioneer and frontier explorer Daniel Boone was hired by Henderson to establish the Wilderness Road going through the Cumberland Gap and into southeastern Kentucky to facilitate settlement. A governmental compact was concluded by the settlers in May 1775. Most settlement was forestalled by the Revolutionary War, except around established towns. Henderson's Transylvania claim in Kentucky was invalidated by the Virginia General Assembly in 1778, and the remaining Tennessee portion was invalidated by North Carolina in 1783. Henderson was compensated with a land grant along the Ohio River in western Kentucky and the current town of Henderson was founded there.

The Royal Proclamation of 1763 that ended the French and Indian War declared lands west of the Appalachians as "Indian Territory" forbidden to colonial settlement. Continued provocations by colonial explorers, traders and trappers necessitated some concessions by the Indians to concede lands for settlement in exchange for peace. In the 1768 Treaty of Fort Stanwix, the Iroquois ceded their claims on lands south of the Ohio River to the British Empire. Although they claimed sovereignty over much of what is now Kentucky, the Iroquois did not actually reside there, as did their nominal vassal, the Shawnee. In addition, the Cherokee to the south and southeast used much of the area as their historical hunting grounds. Neither of these peoples had been consulted regarding the Stanwix treaty, although a series of borders was worked out with the Cherokee at the Treaty of Hard Labour (1768), the Treaty of Lochaber (1770), and once more in 1771 when they agreed to extend the Lochaber cession into present-day northeast Kentucky. The Shawnee, however, had not conducted a boundary agreement with the colonies since 1758 at the Treaty of Easton, giving them a claim to everything west of the Alleghenies. Consequently, they began to attack frontier settlers moving into the region. This led to Lord Dunmore's War, fought in 1774, primarily between the Shawnee and Virginia Colony. The Shawnee lost this brief war and their chief Cornstalk ceded all their claims south of the Ohio River, including Kentucky.

Also, through much of the second half of the 17th century, a state of war had existed between the "northern tribes" (particularly the Iroquois, and the Lenape and Shawnee who were then tributary to them) and the "southern tribes" of the Cherokee and Catawba, the shared hunting grounds of Kentucky remained a contentious neutral zone.

On 27 August 1774, Richard Henderson, a judge from North Carolina, organized a land speculation company with a number of other prominent North Carolinians. Originally called Richard Henderson and Company, the company name was first changed to the Louisa Company, and finally to the Transylvania Company on January 6, 1775. The Transylvania Company investors hoped to establish a British proprietary colony by purchasing the Kentucky lands from the Cherokee who had earlier settled much of the south and southeastern Kentucky areas and still claimed hunting rights in the abandoned Shawnee lands.

In March 1775, Richard Henderson and Daniel Boone met with more than 1,200 Cherokee at Sycamore Shoals (present day Elizabethton in northeastern Tennessee). Present were Cherokee leaders such as Attakullakulla and Oconostota. With five grant deeds that constituted the Treaty of Sycamore Shoals, Henderson purchased all the land lying between the Cumberland River, the Cumberland Mountains, and the Kentucky River, and situated south of the Ohio River on March 14, 1775. Some adjacent land to the southeast, in Virginia and North Carolina, was also purchased. The land thus delineated, 20 million acres (81,000 km²), encompassed an area half the size of present-day Kentucky.

Henderson and his partners probably believed that a recent British legal opinion, the Pratt–Yorke opinion, had made such purchases legal. In fact, the Transylvania Company's purchase was in violation of both Virginia and North Carolina law, as well as the Royal Proclamation of 1763, which prohibited private purchase of American Indian land and the establishment of any non-Crown sanctioned colony.

The treaty was disavowed by some of the chiefs. A dissident Cherokee chief, Dragging Canoe, refused to sign, endorse, or obey the Treaty of Sycamore Shoals, declaring that "it is bloody ground, and will be dark and difficult to settle". It would prove to be prophetic, and subsequently Kentucky came to be referred to by the sardonic phrase, dark and bloody ground. Dragging Canoe left the Sycamore Shoals treaty grounds and took those who were loyal to him and his way of thinking into southeastern Tennessee, near present-day Chattanooga. This group came to be called the "Chickamauga" after the nearby creek of the same name. Dragging Canoe and this group went on to become the chief protagonists of the Cherokee-American wars.