On the heels of the Texas Revolution, two real estate promoters who had arrived in Texas in 1832, John Kirby Allen and Augustus Chapman Allen were seeking a new town site within the Galveston Bay system.

They had invested in Galveston already, but they continued to make offers for other tracts in the region.

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A bill had been introduced on November 26, 1838 in Congress that would establish this entity. Also, on January 14, 1839, the capital had been moved to Austin, known as Waterloo at the time. Many were educated and arrived with capital to set up businesses or buy farms.

On April 4, 1840, John Carlos hosted a meeting to establish the Houston Chamber of Commerce at the City Exchange building. The port in Houston was getting some shipping business, but the shallowness of the water hampered massive shipping.

They bid on land at Morgan's Point and Harrisburg before settling on the eventual Houston site.

The "city to be" was named after Sam Houston, the hero of San Jacinto, whom the Allen brothers admired and anticipated to be the first President of the Republic of Texas.

At this time, drunkenness, dueling, brawling, prostitution, and profanity began to become a problem in early Houston. Austin became capital again in 1845, just before Texas gained statehood.