At age 21, he was elected to and served in the legislature of the Missouri Territory. As a member of the territorial legislature, he was "influential in obtaining a charter for the struggling Bank of St. Louis." Left penniless after the Panic of 1819, Austin decided to move south to the new Arkansas Territory. He acquired property on the south bank of the Arkansas River, in the area that would later become Little Rock. After purchasing the property, he learned the area was being considered as the location for the new territorial capital, which could make his land worth a great deal more. He made his home in Hempstead County, Arkansas. Two weeks before the first Arkansas territorial elections in 1820, Austin declared his candidacy for Congress. His late entrance meant his name did not appear on the ballot in two of the five counties, but he still placed second in the field of six candidates. Later, he was appointed as a judge for the First Circuit Court. Over the next few months, Little Rock did become the territorial capital. But Austin's claim to land in the area was contested, and the courts ruled against him. The Territorial Assembly reorganized the government and abolished Austin's judgeship.