One of the first modern settlers to arrive in Ruidoso was Captain Henry Stanton in 1855 who was received orders from the brass at Fort Fillmore on the outskirts Las Cruces to meet up with up Captain R.E Ewell and hunt down a band of Apaches who had stolen over 2,500 head of sheep.  In an ironic twist, Captain Stanton was killed on the expedition leading to the creation of Fort Stanton in 1855, designed to protect and provide law enforcement to the settlers of the Ruidoso Valley who were under constant attack from the Native Americans. Of course Stanton was not the first person to walk the hills and valleys of Ruidoso, The Spanish were said to be the ones to discover the area, with the Mescalero Apache Indians who created settlements up and down the river valley.
However, the person most created with establishing the area that covers much of where the modern-day town sits is a Civil War veteran named Paul Dowlin who as a member of the New Mexico Volunteers, worked as a post trader at Fort Stanton. Like many Civil War veterans, Dowlin received a 160 acre homestead and through a land purchase grant, received an additional 600 acres for the purposes of constructing a planning mill for wood. He soon discovered that there was not enough force produced by the local rivers to power the wood mill, so he converted the mill for grinding grain. Early on, the town itself was often referred to as “Dowlin’s Mill.” Dowlin was shot to death on May 5, 1877 by an employee who fled for Texas and was never seen again. Ruidoso was later named be name after the Spanish word for “noisy river”.