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This study examines the industrial growth that took place in the Potomac River Valley from 1760 to 1860. Despite early enthusiasm, this region, which includes portions of Maryland, Virginia, and the District of Columbia, underwent an alternative route of industrial development. Agriculture remained the center of economic development, but the activities and attitudes towards manufacturing in the Potomac River Valley went through three distinct phases, and included the founding of iron furnaces, glass houses, textile mills, coalfields, and tan yards. By studying the corporate histories and industrial growth of a region that has traditionally been viewed as economically backward, this study brings us closer to understanding the changes and development of the nation. A close examination of written records of the region explain the business, economic and social choices made by the residents of the Potomac River Valley during this period. Company documents cited include the reports of the Chesapeake and Ohio Canal Company, as well as papers of local companies. Personal diaries and papers, newspapers, and traveler's accounts were also consulted in order to understand the region's development. In addition, government documents, including the Bureau of the Census reports, were also consulted on this project. In the early period, the ventures undertaken in the region paralleled those undertaken in other parts of the country as nationalism fueled speculation in new industries, especially textile mills. After the War of 1812 residents focused on internal improvements. This had far reaching consequences as decisions made by the Chesapeake and Ohio Canal Company interfered with and delayed industrial development in the region. During the 1830s and 1840s entrepreneurs tried to recreate the mill towns of New England in the Potomac River Valley, but none of these water-powered industrial sites were successfully developed. With the exception of the coalfields, after 1840 new industrial ventures were regional industries, that required less start up capital. Particular success was found in the tanning business. Despite the apparent industrial failure of the region, the economy of the region had been transformed, and was far more diverse and complex than it had been at the start of the nineteenth century.