Wyoming v. Colorado was a dispute over the allocation of a river originating in Colorado: the Laramie River. The Laramie flows down the eastern flank of Colorado’s Front Range, through the Roosevelt Forest, and then turns north entering Wyoming. This dispute also turned on the doctrine of prior appropriation – first in time, first in right – that governed water law in both states. The Laramie’s headwaters originate in Chambers Lake, in Colorado’s Roosevelt National Forest, in western Larimer County, Colorado. It is an unnavigable river, which flows northnorthwest from the Roosevelt Forest for 25 miles in Colorado into Wyoming, where it flows for some 150 miles through the City of Laramie turning east-northeast south of Garrett, and empties into the North Platte River near Casper, Wyoming.
The dispute began in 1900, when irrigators in southern Wyoming became aware that irrigators in Colorado, the upstream state, were using the waters of the Laramie River. The Coloradans utilized the waters along the river’s alpine valley to irrigate their hay meadows and for grazing for their livestock. However, to the east of these meadows, near Greeley, Colorado, there was a paucity of water for irrigation. Thus, in 1902, a Colorado corporation began to build a tunnel, the Laramie–Poudre tunnel, to divert water from the northerly-flowing Laramie to the easterly-flowing Cache La Poudre River, so that the lands east of the Laramie in the high plains near Greeley, could also be utilized for irrigation.
At approximately the same time, north of Laramie, Wyoming, that state’s irrigators began building the Wheatland project, an irrigation district fed by water diverted from the Laramie River, into the twenty-mile-wide Wheatland flats. The project planned for irrigation of the flats, which were for the most part owned by then judge Joseph M. Carey – who subsequently became a United States Senator from Wyoming – his son and other partners. The judge and his co-owners also sought to divert water from the Laramie into two adjacent creeks, the Blue Grass and Sybille creeks. These creeks flowed onto the Wheatland Flats, and Carey’s company’s 50,000 acres. The proposal consisted of building a dam and canals to transport water to farmers, who purchased land from the Carey partners, and who would then be obliged to pay Carey’s company for irrigation water. In aid of his company, in 1892, now Senator Carey drafted and introduced the Federal Desert Land Act, also known as the Carey Act, which was enacted in 1894.
The Act provided for private entities in the United States to construct irrigation systems in Idaho, Wyoming, and other western semi-arid states, and profit from the sales of water. The Carey Act was a new approach to the federal government’s disposal of public lands, in its efforts to attract new western settlers. Rather than undertake the advertising and other efforts required to dispose of these public lands, the government “farmed out” this task to private companies, who would entice new settlers to the land. Needing water to irrigate their crops, these settlers would then have to pay these companies a fee for the water they utilized for irrigation. Thus, in 1904, Carey’s company advertised and attracted farmers unto its 50,000 acres, which at this point was watered by the Wheatland Project.
 James E. Sherow, The Latent Influence of Equity in Wyoming v. Colorado (1922), 2 Great Plains Res. A J. Nat. & Soc. Sci., Paper 44 (1992) 7, 10.
 Act of August 18, 1894 (28 Stat. 422), as amended by PL 114–38 (codified at 43 USC § 641 et seq.) The Act allowed private companies to construct irrigation structures in the western semi-arid states, such as Wyoming, and profit from the sales of water, used to “reclaim” desert lands “therein, and [aid in] the settlement, cultivation and sale thereof in small tracts to actual settlers . . . ”)