The earliest settlement in Nevada County was made in the summer of 1848 at a place called Rose’s Corral which was located between the Anthony House and Bridgeport. Early in the spring of 1849 a group of mountaineers from Oregon known as the Greenwood Company mined for gold at Illinois Bar on the South Yuba River. They were followed by emigrants from Indiana. In the fall of 1849, the Greenwood Company made winter camp at Jefferson, and the Indiana group moved further upstream to Washington. It was that same autumn that Captain John Pennington’s party struck rich diggings on Deer Creek and built the first cabin on Gold Run, the site that was to become Nevada City. (Source Ed Tyson)
Originally a mining camp founded along Deer Creek in 1849, Nevada City rapidly became the largest and wealthiest mining town in California. At one point, Nevada City was the third largest city in California with a population of 10,000. Nevada City’s good fortune allowed miners and settlers to enjoy plush gambling establishments, hotels, saloons, and stores. However, like many big cities that sprang up quickly during the rush for instant wealth, early Nevada City shared a darker side of claim jumping, murder, brothels and opium dens.