Until 1851, squatters’ privileges were not a major concern since there was sufficient agricultural land available to meet demand. Between 1846 and 1851, more than 100,000 acres of land had been sold in the ‘settled’ districts near Melbourne, Geelong and the coastal towns. The Imperial Waste Lands Act 1846 and the Order-in-Council of March 1847 granted leases of up to fourteen years to squatters in the ‘unsettled’ districts covering the northern half of Victoria and for up to eight years in the ‘intermediate’ districts that included the Western District and Gippsland. In both areas, squatters had the sole or pre-emptive right to buy any part of the land during the period of their leases. However, a precise survey was necessary for this to have legal effect, and this had hardly begun by 1851.  Once the gold rushes began, growing demand for farming land put pressure on the government to open some of the squatting areas. 
This situation created major problems for La Trobe. First, should squatters be given pre-emptive rights if leases could not be issued? Squatters were buying and selling land on the assumption that pre-emptive rights applied. Secondly, and equally pressing was whether the Government could sell any public land outside the ‘settled’ districts where there was little unsold land left. La Trobe was not a defender of the squatters and argued for a liberal interpretation of the 1846 Act believing that it was the duty of government to sell land when and more importantly where it was needed. Consequently, he reserved 700,000 acres ‘for public purposes’ where pre-emptive rights did not apply.
Some members of the Legislative Council were highly critical of the squatters but in July 1852, they were defeated on a motion of extend the boundaries of the ‘settled’ districts and that leases be issued for the ‘intermediate’ districts so that the Government could bring forward land for sale without having to rely on its reserves. Squatters were unwilling to compromise and La Trobe’s executive voted with them to demand the immediate issue of leases for all pastoral land outside the ‘settled’ districts. This was a short-lived victory and radical members of the Council mounted a strident public campaign that led to a compromise of sorts. Protests against the squatters were bitter reflecting long established hostility and the need for outlets for capital than genuine land hunger. Growing demand for land came from successful diggers and urban speculators. For miners, land signified social status; for urban businessmen it was a way to break the economic and political dominance of the ‘squattocracy’.
On 18 August 1852, La Trobe informed the Council that he did not have the power to issue leases immediately and that he would refer the issue to the Colonial Office. In the interim, squatters would be allowed to buy their homestead blocks of up to 640 acres and the existing policy of reserving land for future sale would continue. While this may have satisfied many squatters, some extremists such as William Campbell reacted bitterly. In early September they restated their position and La Trobe forwarded their views to the Colonial Office along with a wordy dispatch on the issue.  La Trobe then gradually brought more land on to the market. With growing demands from diggers for land, in December 1852 a deputation from Castlemaine with a petition signed by thirteen hundred miners was promised that land near the diggings would be sold as soon as they were surveyed. In early 1853, the movement concentrated on the need for sales of 20, 40 and 80 acre lots near the fields. The Colonial Reform Association, formed in November 1852 on a broad radical platform increasingly concentrated on the land question and the Argus, with monotonous regularity called on the government to ‘Unlock the Lands’.
Despite criticism from the squatters, La Trobe went ahead with the sale of land and in the eighteen months from April 1853, half a million acres of land was sold. This policy, however, came too late to avert criticism caused by his indecision. Increasing land values was an inevitable result of growing demand for land: in 1851 land was about 25 shillings an acre but by 1853 this had risen to £4. The Colonial Office received La Trobe’s dispatch at the end of 1852 and its response, sent to La Trobe eleven months later, approved his actions and passed the power of decision to the Victorian Government. It could establish reserves and sell land under existing legislation, could vary the classification of the districts as it thought best, and could issue leases to squatters but should confine pre-emptive rights to the homestead block. The news arrived in the colony in March 1854. The Colonial Office had come down firmly against the squatters and the Argus celebrated that: ‘The lands are unlocked at last!’ This was over-optimistic. Many miners had simply given up or moved to the United States, South Australia or New Zealand where land was freely available. In reality, land remained firmly locked to the poorer farmers.
Politics in Victoria was deeply marked by Eureka. Ebbels argued that ‘the concessions to democratic government which followed the Stockade produced a political framework and an atmosphere which facilitated the development of Australian trade unionism’.  The Ballarat Reform League, with its main demands won in 1855, duly developed into a new organisation, the Victoria Land League, with its emblem the Southern Cross, and its motto ‘Advance Australia’.  With the influx of population in the gold rushes, the distribution of these sheep walks to agricultural settlers became a vital political issue. The diggers and other newcomers took up politics seriously in 1857, the first year of the new parliament. At public meetings throughout the colony, they elected delegates to go to Melbourne to convene something akin to a Chartist convention. The democratic members of the Victorian Assembly provided a great stimulus to the Land League and its People’s Parliament that met nightly at the Eastern Market in Melbourne for three weeks in July 1857, in close proximity to St. Patrick’s Hall where parliament was sitting. 89 delegates from 32 places throughout the colony met to formulate a people’s land policy and to fight for the People’s Charter, especially payment of members. The Convention organisers realised that parliament, especially the Legislative Council, would not readily yield to the popular cry to ‘unlock the lands’. One of the most articulate justifications of land rights was written by ‘Peter Papineau’, who published a pamphlet Homesteads for the People in Melbourne in 1855, a pamphlet has all the hallmarks of Henry Chapman’s writing.  Wilson Gray declared that the convention would have to fight its own battle on the hustings and led a deputation to the government to warn of ‘national calamity’ if land reform were delayed. As David Goodman explains ‘democratic politics in the 1850s…placed the issue of right to the land at the very centre of public discussion’. 
 No leases were ever issued under this legislation and throughout the 1850s squatter occupancy of their runs continued with annual licences.
 Ibid, Roberts, Stephen H., The Squatting Age in Australia 1835-1847, pp. 350-358, is useful on the land question in the early 1850s; Clark; Selected Documents 2, pp. 179-180.
 William Campbell’s position can be found best in his The Crown Lands of Australia being an Exposition of the Land Regulations, and of the Claims and Grievances of Crown Tenants, (John Smith & Sons), 1855, pp. 31-54.
 Ebbles, R. N., The Australian Labor Movement 1850-1907, (Melbourne University Press), 1965, p. 4.
 Serle, p. 269; Argus, 29 December 1856, 20 January 1857; letter by Gray in Age, 5 May 1857.
 ‘Papineau, Peter’, Homesteads for the People and Manhood Suffrage, (S. Goode), 1855.
 Woods, Carole, ‘Moses Wilson Gray, (1813-1875)’, ADB, Vol. 4, 1972, pp. 287-288.
 Goodman, David, ‘Making an Edgier History of Gold’, ibid, McCalman, Iain, Cook, Alexander and Reeves, Andrew, (eds.), Gold, p. 32.