History of Northwest Territories capital cities 18, 1967, after the Carrothers commission chose it for its central location, transportation links, industrial base and residents' preferences. Yellowknife, in 1967, was not yet ready to serve as home for the government. During the years that it took for the capital's infrastructure to slowly develop, most of the civil service remained in Fort Smith for many years and the governing Council continued its practice of holding legislative sessions all over the territory for a number of years. The Northwest Territories marked a new era when the legislative council moved into a newly constructed legislature building on November 17, 1993.
Yellowknife Yellowknife began with the discovery of diamonds north of the city in 1991. The last of the gold mines in Yellowknife closed in 2004. Today, Yellowknife is primarily a government town and a service centre for the diamond mines. On April 1, 1999, its purview as capital of the NWT was reduced when the territory of Nunavut was split from the NWT. As a result, jurisdiction for that region of Canada was transferred to the new capital city of Iqaluit. Consequently, Yellowknife lost its standing as the Canadian capital city with the smallest population. Yellowknife is on the Canadian Shield,