Skip to main content

History of Marijuana: Origins and Legalization

Marijuana has gone from an ancient medicinal herb to an edible gummy bear -- but how has the plant's tumultuous past impacted its future market?
  • Author:
  • Updated:

These days it seems like Wall Street has high hopes for the blossoming cannabis industry -- with marijuana stocks rapidly gaining traction. 

As other companies like Coca-Cola (KO) - Get Coca-Cola Company Report works on getting a piece of the pot pie, it seems the wave of approval for cannabis-based companies and IPOs won't be stopped. 

But, how did this all start? What is the history of marijuana, and how did we get here? 

Learn more about strains and different kinds of marijuana.

History of Marijuana

The marijuana plant has its origins as a medicinal plant thousands of years back -- many reports are traced back to Chinese Emperor Shen Nung in 2727 B.C., and was commonly used by 500 B.C. in Asia. The plant, called cannabis sativa, allegedly experienced widespread use in a variety of cultures, including Indians, Muslims, Persians and the ancient Greeks and Romans. 

Early uses of marijuana were largely medicinal, and it was used to treat things like inflammation, malaria, gout, depression, nausea, as an anesthetic and even to suppress sexual desires. Still, there is evidence that some cultures used the psychoactive component of marijuana (THC) for rituals or religious ceremonies. 

Marijuana was likely brought to North America by the Spanish in the late 1500s, and early colonies in the United States also grew marijuana and used hemp for a variety of applications -- for example, using the fibers of the hemp plant to make paper, rope and other products. 

Timeline of Marijuana

While marijuana has been in use both recreationally and medicinally for thousands of years, recent centuries have seen a tumultuous turn in the plant's legality and history. From its prohibition in the early 1930s to its slow legalization across some states in the United States, cannabis has remained a hot topic of controversy -- but its future now seems promising as an emerging market.  

Marijuana in the United States

In the United States, early colonists grew hemp (a cannabis plant) often for use in textiles or even things like making rope. By the 1600s, farmers in colonies like Virginia, Massachusetts and Connecticut were growing the plant. It has even been suggested that Thomas Jefferson and George Washington grew hemp on their plantations. 

Racial Undertones

During the 19th century, the word "cannabis" was almost exclusively used to refer to the plant. However, when anti-Mexican sentiment in the United States began to rise in the early 20th century, the term was switched to "marijuana" to draw attention to the drug's use by Mexicans -- and thereby attempt to carry a negative connotation. 

Some common theories about the racial undertones of the stigma against cannabis circulate around the government associating marijuana use with dangerous, homicidal tendencies brought on by "locoweed" -- Mexican cannabis. This stigma, combined with the rising racial tensions against people of color, contributed to increasing federal regulation of the drug. 

In fact, in an article entitled "More Reefer Madness," The Atlantic explained the likely racial origins of the prohibition of marijuana.

"The political upheaval in Mexico that culminated in the Revolution of 1910 led to a wave of Mexican immigration to states throughout the American Southwest. The prejudices and fears that greeted these peasant immigrants also extended to their traditional means of intoxication: smoking marijuana. Police officers in Texas claimed that marijuana incited violent crimes, aroused a 'lust for blood' and gave its users 'superhuman strength.' Rumors spread that Mexicans were distributing this 'killer weed' to unsuspecting American schoolchildren. Sailors and West Indian immigrants brought the practice of smoking marijuana to port cities along the Gulf of Mexico. In New Orleans, newspaper articles associated the drug with African-Americans, jazz musicians, prostitutes, and underworld whites. 'The Marijuana Menace,' as sketched by anti-drug campaigners, was personified by inferior races and social deviants," The Atlantic reported in a 1997 issue. 

Additionally, the infamous quote by Harry Anslinger -- one of the leaders of the prohibition -- reads that "There are 100,000 total marijuana smokers in the U.S., and most are Negroes, Hispanics, Filipinos and entertainers. Their Satanic music, jazz and swing result from marijuana use. This marijuana causes white women to seek sexual relations with Negroes, entertainers and any others."

While the racial language may have since largely dissipated, The Guardian reported this year that in 2016, 600,000 cannabis-related arrests took place, with the large majority affecting minorities. And, after the 2016 presidential election, Attorney General Jeff Sessions is reportedly attempting to reinforce federal marijuana laws and make states enforce them. 

Marijuana Tax Act of 1937

By 1937, the Marijuana Tax Act effectively banned sale of the plant by imposing heavy excise taxes on sale, possession, or transportation of hemp. This act, set by the federal U.S. government, lead to the first marijuana-related arrest in October of 1937 of 58-year-old Samuel Caldwell -- a farmer caught selling cannabis. 

Scroll to Continue

TheStreet Recommends

Although marijuana continued to be grown in the United States, the last official hemp fields were planted in Wisconsin in 1957. 

Dr. Aung-Din, board-certified General Neurology & Neuro-Psychiatry practitioner, has long been a proponent of medical cannabis for treatment of a variety of ailments including epilepsy and even cancers. And even Dr. Aung-Din claims the early attempts of the government in the 1900s still have an effect on how the drug is treated today.

"The Marijuana Tax Act ... levied a huge tax so that people would [be] dissuaded from buying cannabis. So, 1941, cannabis was removed from all pharmacopoeias -- you couldn't get it in stores and couldn't find any evidence of it. ... And since then, there has been stigma and I was even subject to that in medical school," Dr. Aung-Din told TheStreet. 

"War on Drugs" 

By 1970, the Controlled Substances Act, as part of the "War on Drugs" spearheaded by President Richard Nixon, repealed the Marijuana Tax Act, but classified cannabis as a Schedule 1 drug -- in the same category as heroin, LSD, cocaine and ecstasy. Drugs, according to the administration, were "public enemy number one."

Marijuana remains a Schedule 1 drug today -- causing great difficulties for those wishing to study its medicinal properties, as Dr. Aung-Din has witnessed. Contrary to numerous medical opinions, the definition of Schedule 1 seems to clash with marijuana's actual benefits.

"Some of my colleagues believe in the efficacy [of marijuana], but either they cannot use it because they're associated with universities or hospitals -- which receive federal grants, so they can't use it -- or, they're afraid to use it and have the DEA coming after them because it's still labeled as a controlled substance category 1 ... which means, by definition, no medical use and highly addictive," says Dr. Aung-Din. 

Still, Nixon's Act largely ignored the National Commission on Marijuana and Drug Abuse's report in 1972 titled "Marijuana: A Signal of Misunderstanding," which prompted lesser penalties for small possessions and incremental prohibition. 

"Reefer Madness" 

The widely popular film "Reefer Madness," released in 1936, fueled parental concern over marijuana use and spread fear that the youth of America faced devious marijuana dealers that would corrupt them and lead to things like crime and sex. 

Although culture eventually began to become more educated about the actual effects of cannabis use, the film and culture surrounding it permeated society deeply and portrayed marijuana as a gateway drug to even more dangerous substances -- a stereotype that exists today. 

Still, with the recent craze over marijuana stocks and companies, some are claiming another kind of proverbial "reefer madness" is going on

First Legalization of Medical Marijuana

Through the Compassionate Use Act of 1996, California officially became the first state to legalize medical marijuana for use by patients with chronic illnesses. 

Following its footsteps, the 1990s saw the legalization in four other states plus Washington D.C. for medical marijuana, including Oregon, Washington, Alaska and Maine. By the early 2000s, more states -- now including Nevada, Montana, Rhode Island, Hawaii, Vermont and New Mexico -- passed medical marijuana laws. 

Since 2010, 16 states have legalized the medical use of marijuana. 

First Legalization of Recreational Marijuana

Washington state and Vermont were the first two states to vote to legalize the recreational use of marijuana in 2012. Colorado's Proposition 64 made adult possession (those over 21 years of age) and business sale legal. 

Several states followed, currently leaving recreational marijuana legal in nine states plus Washington D.C. 

States that have Legalized Marijuana (in some form) 

As of 2018, there are 30 states plus Washington D.C. that have legalized marijuana in some form. Those states include Alaska, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, Washington D.C., Florida, Hawaii, Illinois, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, New Hampshire, Nevada, New Jersey, New Mexico, New York, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and West Virginia. 

First Marijuana IPO

On July 19, 2018, the first marijuana IPO in the United States -- Canadian company Tilray (TLRY) - Get Tilray Brands, Inc. Report  -- began trading at $23 on the Nasdaq I:IXIC

Since its IPO, Tilray shares have been nothing short of a roller coaster -- with shares hitting highs of nearly $300 in a trading session earlier this week.

What's Next for Marijuana? 

According to a study by the Arcview Market Research and BDS Analytics, the North American marijuana market made an astounding $9.7 billion last year -- up 33% from the previous year. And, according to their estimates, the legal marijuana industry is projected to generate $32 billion of overall global economic impact by 2022. 

Additionally, one in four young adults uses marijuana, according to a Gallup poll in 2018. And, with 64% of Americans supporting the legalization of marijuana, it seems as though federal legalization isn't too far off. 

Corporations and industries alike seem to be revving up for the inevitable widespread legalization. In fact, Coca-Cola (KO) - Get Coca-Cola Company Report recently announced intentions to break into the cannabis industry with an infused drink. And while Aurora Cannabis Inc. (ACBFF) may not be their intended partner, it is clear that the alcohol industry is looking to capitalize on the enormous emerging market.  

Different Kinds of Marijuana

Marijuana has been used in a variety of ways, including for medicinal and recreational purposes. Different kinds of marijuana -- like CBD (cannabidiol), THC and medical marijuana -- have been legalized at various intervals in various states in the United States.

Medical marijuana

For thousands of years, different cultures have been using marijuana for its medicinal properties. In the 1830s, Irish doctor Sir William Brooke O'Shaughnessy discovered marijuana's benefits in treating nausea and pain in cholera patients in India. This lead to the widespread sale and use of cannabis as a cure for a variety of stomach ailments in Europe and even the United States -- primarily by doctors and pharmacies in the later 19th century.

Today, different compounds of marijuana -- like CBD and THC -- are being used to treat a variety of conditions like epilepsy and cancer-related ailments. 

CBD (cannabidiol)

CBD is the non-psychoactive component of marijuana that is often associated with its health benefits, including relieving anxiety and depression, while THC, the psychoactive component, induces sleep or drowsiness.

Because CBD and THC do not operate the same way (and have different effects on the body), they have seen varying uses over the years -- specifically in the medical arena.

The first CBD-based drug, Epidiolex, by GD Pharmaceuticals (GWPH) - Get GW Pharmaceuticals Plc Report , was approved earlier in 2018 by the FDA to treat epilepsy. Experts believe it may trigger wider FDA approval of CBD-based drugs and medications. Kris Krane, president of 4Front Ventures, sees the drug's approval as a snowball effect that could redirect patients from more dangerous alternatives.

"I do see it as a positive development overall. I know there are other companies out there that are working on different types of cannabinoid-based drugs, so I think it's likely to usher in a new era of cannabinoid-based pharmaceuticals and that's overall positive," Krane explained to TheStreet. "The more access points patients have to take cannabis or cannabinoid medicine, the better. Because they're effective in treating a range of conditions, it can be an alternative to opiates."


THC, or tetrahydrocannabinol, is the psychoactive component of marijuana that has more frequently been the source of controversy regarding the plant's usage.

While traditional recreational use of the cannabis plant may have involved smoking high levels of THC for religious or other ceremonies, recent centuries have seen the compound transformed into anything from tinctures to gummies and edibles.

In addition, synthetic THC has also been used to create the drug Marinol, used for treating nausea and vomiting associated with cancer treatment.