While most North American histories begin with European settlement, it is important to understand that for thousands of years, Vancouver was home to the Halkomelem-speaking Coash Salish peoples - a rich native population that had many villages in and around this coastal region. While the Coash Salish populations were decimated due to the smallpox epidemics in the 1800's, Coast Salish people still live in Greater Vancouver and are still very much a part of Vancouver's demographic.

European settlement first began in Vancouver in the 1860's. At that time, Victoria was a small city on Vancouver Island and New Westminster was the largest European settlement on the mainland, while Vancouver was only a sawmill— Hastings Mill—a lonely lumberyard located on the south shore of Burrard Inlet. Most of the land surrounding Vancouver was logged and milled at Hastings Mill by white men. However, because there was nothing else out at Hastings Mill, a New Westminster entrepreneur named Jack Deighton thought it would be a marvelous idea to start up a saloon there to serve all the working men. Jack Deighton came ashore in several canoes with his Native wife and several of his in-laws. They brought two barrels of whiskey with them. Jack served the first one free to the mill workers as they came off shift. When the whole crew was happily stewed he lamented not having the means to build a saloon so as to serve the men on an ongoing basis. That problem was remedied when the Irish crew boss took his men to the stacks of sawn lumber and built a saloon that very night on credit. The next evening Jack was serving drinks over a plank of rough cut wood placed across the top of the empty barrel. Because Jack Deighton talked a lot, he earned the name of "Gassy Jack", and the townsite of Gastown was born.

Gassy Jack made and lost his fortune three times. He travelled to Southern California to live the good life with the lumber and silver barons only to return and discover his good natured relatives were extending too much credit or merely forgetting to charge and his funds were exhausted. Jack would stay long enough to rebuild and then he was off again. Some of his descendants still live in the Fraser Valley centered in Chilliwack. Soon after, more saloons opened up, and with the saloons came the brothels and other forms of vice. This was essentially Vancouver's first existence as an urban center — a rough and tumble collection of saloons and other vices for the working men at the mill.

Gastown soon grew and  was renamed the Township of Granville, but it wasn't until 1886 that the town officially became the City of Vancouver. The name Vancouver was chosen because of Captain George Vancouver who was an early explorer to the region. The name Vancouver was also chosen because at the time, Vancouver Island was a relatively well-known island, and their logic was that if the city was named "Vancouver", then people would know it was very close to Vancouver Island. Of course, Vancouver the city is not on Vancouver Island - something that causes confusion for first-time visitors to this day!

By the time that Vancouver was officially recognized as a city, the city had grown because of the new railway — the CPR (Canadian Pacific Railway) — that finally linked the province of British Columbia to the rest of Canada. With the new railroad link, Vancouver's growth flourished as it began to overtake Victoria as Canada's largest Pacific port. The city expanded beyond Gastown and developed its downtown westward towards Granville Street while Chinatown developed eastward, and the saloons, brothels and the city's down and out continued to exist in Gastown. Gastown and its neighbouring region has not changed much to this day, while the rest of Vancouver has changed dramatically.

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