While the Civil War raged in the East and South, Dakota Indians in Minnesota erupted violently into action against white settlers, igniting the tragic Dakota War of 1862. Hemmed in on a narrow reservation along the upper Minnesota River, the Dakota (Sioux) were frustrated by broken treaties, angered by dishonest agents and traders, and near starvation because of crop failures and late annuity payments.

Led by Little Crow, Dakota warriors attacked the Redwood and Yellow Medicine Indian agencies and all whites living on their former lands in southwestern Minnesota. They killed more than 450 whites and took some 250 white and mixed-blood prisoners during the 38-day conflict. White civilians and military units commanded by Henry H. Sibley defended towns and forts, pursued warriors, and eventually forced the Indians to surrender or flee westward. The penalties imposed by vengeful whites were swift and devastating. The federal government hanged 38 Dakota men in the largest mass execution in U.S. history, 300 were imprisoned, and the Dakota people were banished from the state.