The town was founded in 1859 during the Colorado Gold Rush after the discovery of placer gold in Tarryall Creek. The Tarryall diggings, as well as other discoveries, prompted a flood of prospectors into South Park via Ute Pass and Kenosha Pass. Most newly arriving miners found that all available land for mining along the Tarryall Creek had been claimed by earlier arrivals, and much resentment ensued. It was thought that the earlier miners had claimed much more land than a man could reasonably work, and latecomers called Tarryall Grab All. Another mining town, founded not far away on the Middle Fork of the South Platte River, was named Fairplay as a dig at Tarryall.