The Santa Fe Trail, which passed through Raton, was blazed 909 miles from Missouri to New Mexico, ending at the state capital of Santa Fe. Huge profits from trade encouraged many businessmen to take on the challenge of developing the commercial route.

These merchant entrepreneurs were welcomed at the famed Clifton House, a trading post and hotel at the south end of Raton Pass, where Uncle Dick Wootton collected $1.50 toll from each wagon.

During the peak years of the Santa Fe Trail, northeastern New Mexico was part of the largest singly owned tract of land in the Northern Hemisphere. Lucien Maxwell encouraged many to come and be ranchers on the high plains, mountains and canyons that covered almost two million acres. Gracious and beautiful, these large ranches greatly contributed to the history and development of the area. From these lands, the Maxwell Land Grant Company deeded 320 acres "situated upon the line of the New Mexico and Southern Pacific railroad near the base of the Raton Mountains" to the New Mexico Townsite Company. This became the townsite for the City of Raton.

Cattle ranching and commerce on the Santa Fe Trail established the Raton area as a trade center. When the railroad roared over the Raton Pass in 1879, the city of Raton was born and its progress became unstoppable. The first coal mines opened that same year, providing additional economic opportunities for Raton.
"Raton" was the choice of the Atchison, Topeka and Santa Fe Railway's (AT & SF) chief engineer. A.A. Robinson fought hard for the shorter route over the steep mountains, avoiding the Cimarron Cutoff. A plentiful water supply and the promise of coal cinched the matter. The AT & SF Railroad thus entered New Mexico via the Raton Pass. On the southern side of the 4.5 percent grade the railroad established its division headquarters, including offices, a roundhouse, and machine shops.

Buildings such as homes and shops were moved in by flatbed rail cars from Otero, a town one mile north of the Clifton House, to a new address at the base of Raton Mountain. Forty-three blocks were platted, and the City of Raton was founded in 1880. Entrepreneurs, sharp to the opportunity, acted swiftly. By the second year, the 100 block on South First Street was solidly built up with saloons and stores and the population has risen to nearly 3,000.

A typical Western frontier town, Raton had shootouts in the streets, and theater in the opera house. Those who came to live and work in Raton were cattlemen from Missouri and Texas, and immigrants from Greece, Italy, the Slavic countries and Asia. Nearby towns followed suit, and grew with the railroad: Maxwell, Springer, Wagon Mound, Watrous and Las Vegas, New Mexico. Ranches prospered as new markets in Kansas City, St. Louis, and Chicago became accessible to livestock trade.

The first coal mine opened in 1879; from its inception, coal mining was linked to the railroad. Although ranchers had been mining coal for their personal use until this time, coal brought big business to Raton. Phelps Dodge and the St. Louis, Rocky Mountain, and the Pacific Company established themselves early in the game. Coal was used to fuel the railroad, heat homes and make steel. After decades of profit, diesel trains and gas heat eventually caused the coal mines to close. Raton remained a healthy business town, trading its livestock and developing small industries. Raton's economy benefited when the mines closed, since the company stores closed as well. Miners, who transferred to other work, now shopped in Raton.

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