In 1861, the British Crown's interest in the lands that became the Stikine Territories was sparked by reports of gold in the Stikine River. The land that became the Stikine Territories extended north of the Finlay and Nass Rivers, which at the time formed the northern boundary of the Colony of British Columbia. It had been part of a vast area under the control of the Hudson's Bay Company. Yet the inaccessibility and the mystery of the territory proved a lure for many as rumours of uncovered riches in the territory gained popularity.
With the discovery of gold just north of the Colony of British Columbia, the region that made up the Stikine Territories was removed from the Hudson's Bay Company's authority and organized as the Stikine Territory by an Order-in-Council on July 19, 1862.
Governor James Douglas was named as the Administrator of the Stikine Territories, with power to appoint judges and other necessary officers, forgive fines, and to make land-use and occupancy and mining regulations. Thus, Britain ensured British authority in regions with a potential gold rush or valuable minerals and resources.
The existence of the Stikine Territories as separate from the Colony of British Columbia was short-lived. On July 28, 1863, the boundary of the Colony of British Columbia was expanded to include the Stikine Territories up to the 60th parallel through "An Act to define the Boundaries of the Colony of British Columbia, and to continue an Act to provide the Government of the said Colony."