Capitol City is unique for two reasons—the odd spelling of its name and the sad ruin of one man’s dream to have his town the capital of Colorado. He was George S. Lee, a mill and smelter operator. Frank Fossett wrote in 1880 in his _Colorado_ that Capitol City was located at the junction of the two forks of Henson Creek, nine miles west of Lake City, in a park most of which was embraced by the Lee townsite patent. The park was surrounded by rugged, towering San Juan peaks, rich in silver, lead and iron ores. Two smelters were in operation at each end of town. Fossett added: “Right here ... where one would least expect to find it is the most elegantly furnished house in Southern Colorado. The handsome brick residence of George S. Lee and lady, distinguished for their hospitality, is a landmark of this locality.” George Lee suffered from the same disease that characterized so many of the pioneers—a compound of boundless optimism and grandiose ambition. He pictured his remote town as the capital of the state and his home as the governor’s mansion. Perhaps it was an idea spoken in jest; perhaps it was his sincere dream. Folklore leans to the latter version—but he never campaigned for his idea nor introduced any bill into the legislature. The name of his town is equally confusing. After Lake City was started in 1874 and platted in 1875, prospectors streamed up Henson Creek, and a town was built at its forks. The newspapers of 1876 and ’77 referred to the town as Capital City, and the Colorado Business Directory for the late 1870’s used interchangeably the two spellings of _Capital_ and _Capitol_. Yet in 1961 the Postmaster General’s office in Washington wrote that “a search of the records for 1876 and ’77 reveals that the spelling of the town referred to was Capitol City.” To confuse matters still further the Colorado State Archives office has recorded a communication, dated May 2, 1887, from the county commissioners of Hinsdale County in which they petition for permission to change the name of Galena City to Capitol City. Why is this petition eleven years late? Poor Capitol City—the whole situation seems as confused as George Lee’s dream! And who was it did not know that “capitol” is a building, not a town? According to the historians, Jean and Don Griswold, Capitol City had two prosperous periods when mining and smelting were booming—a silver boom in the mid-1880’s and a gold boom around the turn of the century. Two factors prevented Capitol City from attaining any major growth. Early litigation discouraged and slowed up the first business activity of the late 1870’s and early 1880’s, and later the gold deposits of the 1900’s were not very large. The population of around three hundred in 1880 became discouraged and drifted away. In 1885 there were but one hundred people residing there, and in 1900 there was the same number again.