In 1718, Bienville, then governor of the province, explored the banks of the Mississippi, in order to choose a spot for the chief settlement, which had hitherto been at Biloxi. He selected the present site, and left fifty men to clear the ground, and erect the necessary buildings. Much opposition was made, both by the military and the directors of the Western Company, to removing the seat of government to this place. Another obstacle, for a while, threatened almost insurmountable difficulties to his design. In 1719, the Mississippi rose to an extraordinary height; and, as the company did not possess sufficient force to protect the spot from inundation, by dykes and levees, it was for a time abandoned. In the November of 1722, however, in pursuance of orders, Delorme removed the principal establishment to New Orleans. In the following year, agreeably to Charlevoix, it consisted only of one hundred cabins, placed with little order, a large wooden warehouse, two or three dwelling-houses, and a miserable store-house, which had been used as a chapel, a mere shed being then the only accommodation afforded for a house of prayer. The population did not exceed two hundred. Thus commenced what is now called the "Crescent City;" which, in a commercial point of view, and in proportion to the number of its inhabitants, has not an equal upon the face of the globe.

During the same year, a party of German emigrants, who had been disappointed by the financier, Law, of settling on lands granted to him in Arkansas, descended the river to New Orleans, in the hope of obtaining passage to France; but the government being either unwilling or unable to grant it, small allotments of land were apportioned them, on what is now called the German Coast. These people supplied the city with garden stuffs; and most of their descendants, with large accessions from the old country, still cultivate the same land, upon a much improved scale.

In September of this year, the capital was visited by a terrible hurricane, which levelled to the ground the church, if such it might be called, the hospital, and thirty houses; and three vessels that lay in the river were driven ashore. So destructive was it to the crops and gardens, that a scarcity of provisions was the consequence; and such was the distress, that several of the inhabitants seriously thought of abandoning the colony.

In the summer of 1727, the Jesuits and Ursuline nuns arrived. The fathers were placed on a tract of land now forming the lowest part of the fauxbourg St. Mary. The nuns were temporarily lodged in a house in the corner of Chartres and Bienville streets—but, soon after, the company laid the foundation of the edifice in Conde and Ursuline streets, to which they were removed in 1730; this place was occupied by them until the great value of the land induced them to divide the larger portion of it into lots. Their new convent was erected about two miles below the city, and there they removed in 1824. At this period, the council house and jail were built, on the upper side of the Cathedral.

In 1763, Clement XIII expelled the Jesuits from the dominions of the kings of France, Spain and Naples. They were, consequently, obliged to leave Louisiana. Their property in New Orleans was seized, and sold for about one hundred and eighty thousand dollars. It is now estimated to be worth upwards of fifteen millions. At the time of the expulsion of this order, they owned the grounds which are now occupied by the second municipality. The valuable buildings in which they dwelt, were situated in Gravier and Magazine streets. Some of them were pulled down to make room for the late banking house of the Canal bank, on the corner of those streets. It is computed, that more than one half of the real estate in this city, is derived from the confiscation of the property of the Jesuits, under legal proceedings had by order of the French government. The archives of the first municipality contain many interesting and curious documents in relation to these proceedings, that are well worth examination.

The first visitation of the yellow fever was in 1769. Since that time it has continued to be almost an annual scourge. It was introduced into this continent, in the above named year, by a British vessel, from the coast of Africa, with a cargo of slaves. In addition to this affliction, (the yellow fever above alluded to,) the colony was, during the year 1769, transferred to Spain, and the capital was taken possession of by O'Reilly, with a show of military power, and an individual disposition to oppress, that brought equal disgrace upon himself, and upon the government that commissioned him. The commerce of this city suffered very much from the restrictive colonial system of Spain. This, however, was removed in 1778, (a year memorable for a fire that burnt nine hundred houses at one time) and, in 1782, the mercantile interest of the place was benefited by still further extended privileges of trade.

The census of 1785 gives to the city a population of 4,780, exclusive of the settlements in the immediate vicinity.

In consequence of the commercial advantages above alluded to, a number of merchants from France established themselves here, and British trading vessels navigated the Mississippi. They were a species of marine pedlars, stopping to trade at any house, by making fast to a tree, and receiving in payment for merchandise, whatever the planter had to spare, or giving him long credits. The Americans, at that time, commenced the establishment of that trade from the west to New Orleans, which has been steadily increasing ever since. The idea of this traffic was first conceived by General Wilkinson. A lucrative business was also conducted by the Philadelphians, which the colonial authorities winked at for a while; but the Spanish minister, finding that he did not participate in the profits of it, as the Americans refused to comply with his hints to consign to his friends, put a stop to it. He procured a list of the names of the vessels, severely reprimanded the intendant, Navarro, and so worked upon his fears that he began to prosecute all infringements of the revenue laws, seizing the vessels, confiscating the goods and imprisoning the owners, captains and crews. The venal minister, perceiving that he had rendered himself extremely unpopular by his intermeddling with the commerce between Philadelphia and New Orleans, finally released all the individuals he had imprisoned, restoring the confiscated property, and discontinuing any further interference. The trade immediately received a new impulse and was greatly increased. General Wilkinson at the same time obtained permission to send one or more launches loaded with tobacco, from Kentucky.

Soon after, many Americans availed themselves of a privilege which was granted, of settling in the country.

The first company of French comedians arrived here in 1791. They came from Cape Francois, whence they made their escape from the revolted slaves. Others from the same quarter opened academies—the education of youth having hitherto been confined to the priests and nuns.