Ballarat lies in an undulating area of the midland plains made up of alluvial sediment and volcanic flows and contains large areas of rich agricultural soil.  It was first settled in 1838 when William Cross Yuille and Henry Anderson established a stock station on the shores of the Black Swamp, now known as Lake Wendouree. ‘Balla’ ‘Arat’ was derived from the native meaning for resting or camping place.  Gold was discovered at Ballarat in August 1851  and within a fortnight, there were 400 people successfully digging for gold around Golden Point, at the foot of Black Hill and on both sides of the Yarrowee River and increased to 20,000 diggers during 1852.  The massive influx of people brought an end to the area as a pastoral backwater and the local landscape was soon transformed and disfigured. William Bramwell Withers (1823-1913) pointed out that before 1851:
the kangaroos leaped unharmed down the ranges, and fed upon the green slopes and flats where the Yarrowee rolled its clear water along its winding course down the valley. 
But the discovery of gold altered the tranquillity of the area and:
…the green banks of the Yarrowee were lined with tubs and cradles, its clear waters were changed to liquid yellow as the yellowest Tiber flood, and its banks grew to be long shoals of tailings. 
The main street, Lydiard Street in 1857 looking west from the government camp.
A tent city sprang into existence and the early diggers peacefully devised ways of organising the goldfields.  Nonetheless, the Victorian Government acted quickly sending Commissioners within weeks to collect the gold license fee.  The first Resident Gold Commissioner, Francis Doverton, was a former military officer and such was his zeal that he began collecting the fee before it was due to come into effect. This led to significant resentment and violence was only averted because of the moderation of the diggers.  By 24 September 1851, 160 licenses had been taken out and before fresh supplies arrived on 6 October, 1,300 handwritten licenses were issued.  License inspections and police duties at Ballarat were the responsibility of mounted police and a detachment of the Native Police Corps led by Captain Henry Dana were despatched to the diggings. The commissioners and troopers camped on a little hill behind the Golden Point.
La Trobe visited the field in October and was impressed by the ability of the diggers to pay the license fee. On his return to Melbourne, he considered Doverton’s inability to extract the fee from every digger and moved him to Mount Alexander appointing William Mair, a police magistrate and inspector of police as his successor.  The first gold rush at Ballarat proved a false start. The layer of gold-bearing gravel near the surface was quickly exhausted and the opening of the Mount Alexander diggings in October 1851 saw an exodus of diggers to the new field.  By December 1851, only a few hundred of the 5,000 diggers who had been in Ballarat in October remained but La Trobe decided to make the settlement permanent and sent W. A. Urquhart to survey and lay out the first goldfield town. Though this was widely ridiculed at the time and by the beginning of 1852, the site was almost deserted, it proved a prescient decision.
Some teams, convinced there might be a deeper gold-bearing layer, sank shafts beneath the shallow gravel beds. Others followed the shallow layer as it gradually became deeper. A number of rich gold bearing leads were located and in May 1852, it was reported that new diggings named the Eureka Leads had been located north of Golden Point but because they were up to fifty metres deep miners had to work in teams to exploit their riches.  Deep leads mining was more dangerous, more labour intensive and required more capital than other forms of gold mining. Parties of up to twelve men, often of the same nationality worked round the clock, four on each shift, on claims about four metres square. Shafts in dry ground were circular but those through water-bearing strata were rectangular and lagged with timber from the hills around Ballarat that were soon denuded of trees. In 1853, £55,200 of gold was taken from a single claim and, in total; the Deep Leads at Ballarat yielded 8.4 million ounces of gold.
 Withers, W. B., History of Ballarat from the First Pastoral Settlement to the Present Time, 1st ed., (The Ballarat Star Office), 1870, 2nd ed., (F. W. Nevans and Co.), 1887, was among the first Australian local histories. Two modern studies of the development of the town are Bate, Weston, Lucky City: The First Generation at Ballarat 1851-1901, (Melbourne University Press), 1978, and Reid, John, Chisholm, John, and Harris, Max, Ballaarat Golden City: A Pictorial History, (Joval, Bacchus Marsh), 1989, reprinted 1999. On Withers see, Austin McCallum, 'Withers, William Bramwell (1823–1913)', Australian Dictionary of Biography, National Centre of Biography, Australian National University, http://adb.anu.edu.au/biography/withers-william-bramwell-4879/text8161, published first in hardcopy 1976
 The Argus used both Ballaarat and Ballarat, often on the same page. Prior to amalgamation of the councils in 1994, the municipality of the City of Ballaarat was the official spelling for the corporation Council, though the official spelling for place-name purposes of the area (then comprised of several municipalities) was Ballarat. When a unitary City Council was established in 1994, the single ‘a’ version was adopted for the corporation. See ibid, Withers, W. B., History of Ballarat, pp. 10, 13.
 ‘Ballarat Diggings’, Geelong Advertiser, 6 September 1851, p. 2.
 Rash, K., ‘The discovery of gold at Ballarat’, Victorian Historical Magazine, Vol. 25, (1954), pp. 133-143.
 Ibid, Withers, W. B., History of Ballarat, p. 9.
 Ibid, Withers, W. B., History of Ballarat, p. 36.
 ‘The Ballarat Diggings’, Geelong Advertiser, 19 September 1851, p. 2, stated that 73 tents and huts had been built in Ballarat with 300 more scattered across the area.
 Geelong Advertiser, 20 September 1851, p. 2, ‘Commissioner Armstrong left Melbourne a few days ago for the Ballarat gold field…’
 Ibid, Withers, W. B., History of Ballarat, p. 35.
 Ballarat Diggings’, Geelong Advertiser, 26 September 1851, p. 2, indicated that licenses had been paid.
 ‘Ballarat Diggings, Geelong Advertiser, 26 September 1851, p. 2.
 Sydney Morning Herald, 4 October 1851, p. 2, Geelong Advertiser, 10 October 1851, p. 2, reported that La Trobe was ‘warmly cheered’ and was ‘well received’ in Ballarat.
 Sheehy, Thomas, ‘William Mair, (1806-1904)’, ADB, Vol. 5, pp. 199-200.
 Ibid, Flett, J., The History of Gold Discovery in Victoria, pp. 345-370, considers the development of gold at Ballarat in the 1850s.
 ‘Eureka Diggings’, Geelong Advertiser, 23 July 1852, p. 2. ‘Geelong Gold Circular’, Argus, 27 September 1852, p. 4, commented that ‘the Eureka is equal in richness to the best field ever opened…’