The French and Indian War, Dunmore's War, and the Revolutionary War placed a heavy financial burden on the often meager resources of the colony and state of Virginia. Virginia leaders turned to Virginia's extensive western lands between the Alleghenies and the Mississippi River, included in the colonial charter of 1609, as an alternative means of discharging wartime debts, including unpaid obligations to thousands of militiamen and their military officers. The distribution of these bounty lands has shaped landholding patterns in Virginia, Kentucky, and West Virginia down to the present.

As early as 1754, Governor Dinwiddie set aside 200,000 acres of land for men who served in the French and Indian War, with up to 400 acres to privates and increasing amounts, depending upon rank, for officers. Many soldiers in need of ready cash sold their land rights for a fraction of their real worth, and speculators acquired thousands of acres, some in large tracts that remained intact for a century or more. George Washington, the commander of the Virginia Regiment during the French and Indian War, chose several prime tracts on the Ohio and Kanawha rivers in present West Virginia. One Kanawha tract was a few miles above Point Pleasant, which was expected to become the capital of Vandalia, a proposed 14th colony.

Bounty lands were sometimes caught in the uncertainties of the Virginia land system in which titles were insecure. Land disputes kept lawyers busy for decades and contributed to some of the worst features of land speculation, including an absentee land ownership that has often added to the social and economic woes of West Virginia.