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Most 19th-century Americans found Christmas trees an oddity. The first record of one being on display was in the 1830s by the German settlers of Pennsylvania, although trees had been a tradition in many German homes much earlier. The Pennsylvania German settlements had community trees as early as 1747.
According to mac-2001.com/philo/crit/GREEK3.TXT -- Gradually during the middle and late 1800's, the celebration of Christmas became so popular, that it began to be declared a state holiday. Alabama was the first state to declare Christmas a legal holiday in 1836. By the time of the Civil War another twenty eight states had also instituted Christmas as a holiday. All U.S. states and territories recognized Christmas as a holiday by 1890. Federal employees were given Christmas as a paid holiday, beginning in 1885.