St. Thomas was originally settled around 1500 BC by the Ciboney people, later replaced by the Arawaks and then the Caribs. Christopher Columbus sighted the island in 1493 on his second voyage to the "New World." The Dutch West India Company established a post on the island in 1657, and the Danish conquered it in 1666, gaining control of the entire island by 1672 through the Danish West India and Guinea Company.
The land was divided into plantations, with sugar cane production becoming the primary economic activity. In 1691 the main settlement was renamed Charlotte Amalie, honoring the wife of Denmark's King Christian V, and was later declared a free port. The sugar trade brought prosperity for a time, but by the early 19th century the island was in decline, its export economy threatened by hurricanes, drought and American competition.
In 1917, St. Thomas — along with St. John and St. Croix — was purchased by the United States from Denmark for $25 million in gold, part of a defensive strategy to protect the Panama Canal and US interests in the Caribbean during the First World War.
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