On October 27, 1795, the U.S. and Spanish signed the Treaty of San Lorenzo, settling their decade-long boundary dispute. All Spanish claims to Natchez were formally surrendered to the United States. More than two years passed before official orders reached the Spanish garrison there. It surrendered the fort and possession of Natchez to United States forces led by Captain Isaac Guion on March 30, 1798.
A week later, Natchez became the first capital of the new Mississippi Territory, created by the Adams administration. After it served for several years as the territorial capital, the territory built a new capital, named Washington, 6 miles (10 km) to the east, also in Adams County. After roughly 15 years, the legislature transferred the capital back to Natchez at the end of 1817, when the territory was admitted as a state. Later the capital was returned to Washington. As the state's population center shifted to the north and east as more settlers entered the area, the legislature voted to move the capital to the more centrally located city of Jackson in 1822.
Throughout the course of the early nineteenth century, Natchez was the center of economic activity for the young state. Its strategic location on the high bluffs on the eastern bank of the
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