Free State of Galveston made these businesses increasingly difficult to sustain. By the end of the 1950s, this era of Galveston's history had ended. The island of Galveston, which lies on the Gulf of Mexico, held one of the first major settlements in the eastern part of what is now Texas. During the mid-to-late-19th century, it became the largest city in the state. Galveston was also an important national commercial center and one of the busiest seaports in the United States, as the Port of Galveston was able to capitalize on Texas' rapid rise in the cotton trade. Its downtown was known as the
Port of Galveston to export on the city's lack of an adequate water supply. However, when the city water project finished in the early 1890s, industrialization still did not occur. In reality, many companies were hesitant to invest in machinery on an island prone to floods. The nearby city of Houston was able to better attract industry and began positioning themselves as a viable alternative to Galveston. The port survived the Galveston Hurricane of 1900 relatively unscathed, but the railroad connecting the island to the mainland suffered significant damage. In response to the hurricane, city leaders dredged the ship channel to raise the