In both Canada and the United States, the federal governments acted as huge real-estate dealers transferring the public domain to settlers who would, ostensibly through their labor, enrich both themselves and their respective nations. The problem with these land-transfer systems, at least as far as the Great Plains was concerned, was that the basic 160-acre settlement unit was devised for a humid environment, not for a subhumid environment where agriculture was a more extensive–and more precarious–enterprise. There was also the problem of speculation, which held land out of actual settlement; many of the land laws were easily manipulated for such a purpose and some seemed to be actually designed for it.

The United States' system had its origins in the Land Ordinance of 1785 which, after subsequent modifications, established an orderly procedure for the alienation of public lands: acquire the lands through cessions from Native Americans; survey them into townships of thirty-six one-square-mile sections, each containing quarter sections of 160 acres; reserve sections 16 and 36 for future sales to support schools (such lands are still being sold off for this purpose); and sell the remaining land to settlers through public auction or through regional public land offices. The exception to this general land alienation system in the Great Plains was Texas, which kept title to its own public lands when it entered the Union. There, the land was sold as a source of revenue and disposed of in land grants for various social purposes. Texas did, however, adopt the same survey system.

Before the Homestead Act of 1862, the main type of sale was through preemption, which was codified in the Preemption Act of 1841. By the terms of the act, an adult could settle on the public domain and secure title to 160 acres by improving the land and paying $1.25 an acre within twelve months. Preemption and the much-abused military bounty land warrants, which were designed to provide soldiers with homes but were transferable and could therefore be amassed in bulk by speculators, were the principal methods of acquiring land in areas of eastern Nebraska and Kansas settled before 1862.

That year, the Homestead Act inaugurated the era of virtually free land for the settler, providing 160 acres for a minimal registration fee and the promise to live on the land and improve it for five years, at which time a patent was issued. After six months settlers who wanted to secure title could purchase the land at $1.25 an acre (perhaps to sell at a profit later). Settlers soon had other options for securing Plains land. Following the 1862 Morrill Act, which allocated public lands to the states for the purpose of supporting agricultural colleges, settlers could purchase scrip, which then could be used to buy land at $1.25 an acre. Again, speculators acquired large amounts of the scrip and bought considerable acreages in the Plains, which they held until land values rose and then sold for a profit. Settlers also had the option of adding to their holdings by locating in railroad land grants, which were given to railroad companies to subsidize construction. By the acts of 1862 and 1864, for example, the Union Pacific Railroad was granted all the odd-numbered sections in every township in a twenty-mile zone on either side of the tracks. Clearly, land near the railroads, the connection to markets and supplies, was in great demand; free homestead sections in the land grants were taken first, giving the characteristic checkerboard settlement pattern, until filled in by the later purchase of railroad sections.

In the Canadian Plains, the Dominion Lands Act of 1872, which followed the Canadian government's acquisition of Rupert's Land from the Hudson's Bay Company, was modeled on the American land survey and free homestead system. The same 640-acre section and thirty-six-section township survey was adopted, and so the rectangular grid came to dominate the entire Great Plains, with profound and inestimable effects on ways of living ever since. A similar free homestead system was inaugurated, but with a "proving-up" time of only three years. Also, as in the United States, two sections (11 and 29) were designated school lands in each township, and following its 1881 charter the Canadian Pacific Railway was given the oddnumbered sections in a land grant extending twenty-four miles on either side of the tracks across the Prairies. "Indemnity selection" allowed the Canadian Pacific to go outside the forty-eight-mile strip if there was not sufficient good land within it. Significant differences from the United States' system were evident in the provision of 160 acres of lands, or $160 in scrip, for Métis, who had preceded the survey, and the reservation of lands–section 8 and three-quarters of section 26 in each township, amounting to more than seven million acres in Manitoba, Saskatchewan, and Alberta –for the Hudson's Bay Company as compensation for the relinquishment of Rupert's Land. The Canadian government, determined to attract immigrants to the Prairies, also made block settlement grants to ethnic groups such as Russian Mennonites and Icelanders, a practice that was not endorsed in the U.S. Great Plains.

Even before John Wesley Powell, in his 1878 , drew attention to the unsuitability of the standard land system for the country west of the 100th meridian, new land laws were being specifically adapted to the Great Plains. In 1873 Congress passed the Timber Culture Act, which was designed to promote the planting of trees in the Great Plains and also, theoretically, to increase rainfall by accelerating transpiration rates. The act stipulated the planting and cultivation of forty acres of trees (later reduced to ten acres) over a period of ten years (later reduced to eight), after which the settler would receive a patent for 160 acres. Most timber claims were filed in the Central and Northern Great Plains. (After 1873, therefore, the Plains settler could legally acquire 480 acres of public domain through the Homestead, Preemption, and Timber Culture Acts for only $200.) However, the fact that only a small proportion of timber entries were carried through to patent indicates the difficulty of fulfilling the provisions of the act in a subhumid environment, but it indicates even more the convenience of the law for the small-scale speculator: settlers could use 160 acres rent-free and tax-free for ten years with no intention of acquiring a patent. At the Cheyenne Land Office in Wyoming Territory, for example, 290,278 timber filings had been made by 1888 but only 65,265 were ever patented. The flawed legislation was repealed in 1891.

Other acts enlarged the size of the holdings that settlers could obtain cheaply or without cost. The Desert Land Act of 1877, which applied to the territories of New Mexico, Wyoming, Montana, and Dakota (and more generally throughout the West), allowed settlers to file on 640 acres for a payment of twenty-five cents an acre. Title could be obtained in three years for an additional payment of $1 an acre and proof of irrigated cultivation. Only one-fourth of the entries in the Great Plains resulted in titles. In 1904 the Kinkaid Act offered settlers in the Nebraska Sandhills 640 acres on homestead terms, and in 1909 the Enlarged Homestead Act increased the free acreage more widely to 320 acres. Under the stimulus of the 1909 act, the plains of eastern Montana in particular filled up with farmers hoping to make a future by dry-farming wheat on their 320 acres. More homestead entries were made there in 1910 alone than in all of the preceding three decades. Montana and the High Plains states of Wyoming, Colorado, and New Mexico were also the main targets of the Stock Raising Homestead Act of 1916, by which settlers could acquire 640 acres of non-irrigable land for the purposes of stock raising and the cultivation of forage crops. But often the settlers had no experience in farming, and almost always they were undercapitalized. In Montana the drought of 1918 put an end to the dreams of many, and many others who "stuck" through that crisis failed in the 1920s and 1930s.

In the Prairie Provinces also, attempts were made to ensure that settlers could acquire a 320-acre holding rather than the clearly inadequate 160 acres. Successful settlers were allowed, through "preemption rights," to file on an adjacent quarter if it was not occupied. Settled farmers, having accumulated some capital, were also encouraged to buy Canadian Pacific Railway lands, and many did, especially after 1908 when the remaining odd-numbered sections were put on the market at reasonable prices. Still, by 1910 in much of the Prairie Provinces and elsewhere in the Plains, even 320 acres was a small holding and hardly adequate for efficient production.

The rate of failure in both the Canadian and U.S. Great Plains points to the overextension of farming that the liberal land laws had encouraged. The gap between the number of land entries and the number of patents issued was glaring: in the Dominion Lands, for example, only 40 percent of homestead entries culminated in a title, and an unknown portion of those that did quickly passed into the hands of speculators. The end of the Dominion policy came in 1930, with the completion of transfer of remaining lands and resources to the provincial governments. In the United States the Taylor Grazing Act of 1934 withdrew from homesteading virtually all the remaining desirable land, though the 1862, 1909, and 1916 acts, which had drawn so many settlers to the Plains, were not repealed.

See also EDUCATION: Morrill Act / TRANSPORTATION: Railroad Land Grants.