Open conflict began when a colonizing project, which had interested the Hudson's Bay Company for some years, was given into the hands of Lord Selkirk in 1811. Selkirk had bought heavily of the company's stock to further his aim of establishing an agricultural settlement near Lake Winnipeg for poverty-stricken Scots and Irishmen. The company's interest in the founding of such a colony was that it might furnish farm produce and also provide a place where retired employees might live. Selkirk took title to 110,000 square miles of land covering large parts of present Manitoba, Minnesota, and North Dakota, and thereby invaded a country the Nor Westers considered their own. Selkirk's domain embraced the fertile valley of the Red River of the North, which, because great herds of buffalo wintered there, was the source of the pemmican that was the trappers' most portable food. 

When the Nor Westers gathered for their annual meeting at Fort William in 1814 (while Britain and the United States were still fighting the War of 1812) their hostility was high. The angry traders were convinced that selkirk's settlement would bring ruin to the fur trade. It seemed clear that any agricultural settlement would cause the beaver in the area to abandon their streams and would also drive away the buffalo. 

After its first hesitant beginnings the Red River Settlement began to assert itself. Selkirk's men seized supplies of pemmican, sought to control buffalo hunting, and ordered the Nor'Westers to remove their trading posts or have them razed to the foundations. The North West Company reacted by taking the governor prisoner, driving out most of the settlers, and burning their houses.