A continuous settlement remained at the junction of the Turkey Creek and the Eagle River since the Rohm party set up their permanent camp at that location in early April 1879. This was the first permanent settlement on the Eagle River, and until 1900, it was the principal town of the region.
Until July 25, 1879, the settlement was either nameless, or known as Battle Mountain. On that day, the inhabitants officially christened the town Red Cliff, named after the quartzite cliffs, stained dark red by the hematite iron present in the rock surrounding the town.
The first hotel was a two-story building with cloth partitions called the Star. It remained the most luxurious lodging in Red Cliff, until the Quartzite hotel was built some years later. In 1882, the following businesses besides the Star and Quartzite hotels were operating: The Southern Hotel, the Pacific Hotel, the Mountain House, the Iowa House, three grocery stores, two drug stores, one clothing store, one meat market, two stationary and newspaper stores, one lumber and livery stable, a stage line, a dairy and two saloons.
Red Cliff was designated the county seat for Eagle county after the division from its larger, original size on February 11, 1883. The original county included the communities across the range such as Breckenridge.
During the winter of 1879-80, many people left town due to the severe cold weather and snow. A census taken in January 1880, showed a population of ninety-six people. However, in the spring, they began returning. Buildings were constructed and twenty thousand board feet of lumber was hauled into town from Leadville. The estimated population in mid-February 1880 was 250.
In 1880, the town already had a recognized post office. The Battle Mountain Smelter started operating in the fall and contributed toward citizen confidence in a growing town. However, a year later it was forced out of business by bankruptcy. It was during this year in March, that the first board was sawed in Melvin Edwards's sawmill and soon Burt and York's saw mill on Turkey Creek was turning out 8,000 board feet of lumber daily and A. W. Callan was thinking of building another sawmill higher on the creek.
Common to boomtowns of the period, Red Cliff suffered from disastrous fires. On September 18, 1882, early in the morning, a fire broke out in the Southern Hotel. It burned completely to the ground. The fire, however, spread to other buildings along Water Street and burned all of that part of the town. Again, in 1883, three fires occurred within a week and the citizens started a movement to establish a water system. The project was finally completed in 1887 when the water system was connected to the Willow Creek, a tributary of Turkey Creek.
On November 20, 1881, the Denver and Rio Grande reached Red Cliff and opened for freight and passenger service. Passengers for Red Cliff would leave Denver at 7:30pm and arrive at Red Cliff at 11:45am the following day. Direct connections were available at Red Cliff with stops for Gold Park. Pullman Sleepers were also available for night travel.
In 1890, Red Cliff had 383 inhabitants, and by 1900, the census showed only 256 people. The decreasing population came about as a result of the closing of many of the mines in the immediate vicinity of Red Cliff and a general decline in mining throughout the area. Up until the turn of the century, Red Cliff was still the railhead for the mines around Battle Mountain, but in a few years, this was moved to Belden, just below Gilman, removing another incentive to population growth.
From 1895 to 1923, Red Cliff fought to keep the county seat against The Town of Eagle that was down valley. However, Eagle's population was rising significantly.