In the early 1840s American settlers began to arrive in significant numbers, traveling overland via the Oregon Trail. The trail ended at The Dalles. It was not possible to take wagons farther west due to steep cliffs that fell straight into the Columbia River. Until the construction of the Barlow Road in 1846, the only way to reach Fort Vancouver and the Willamette Valley was by rafting down the river from The Dalles.A post office was established within the boundaries of the current city in 1851, and The Dalles was incorporated as a city in 1857.

It has been the major commercial center between Portland and Pendleton since. The city was originally named just "Dalles". In 1853 it was changed to "Wascopum," then, in 1860, to "The Dalles".In 1864, the U.S. Congress appropriated money to build a U.S. mint in The Dalles that was to use gold from Canyon City for coinage.

The supply of gold from Canyon City began to dwindle, however, and other problems, such as cost overruns, workers leaving to work the gold fields, and flooding from the Columbia River, also contributed to the project running two years behind schedule and led eventually to its demise. In 1870, the State of Oregon received the property from the U.S.

Government and the building was put to other uses. The mint is now home to Freebridge Brewing. Construction of The Dalles Dam in 1957 submerged the Long Narrows and Celilo Falls. In 1963, Ken Kesey's novel One Flew Over the Cuckoo's Nest was published featuring the narrator, Chief, who is from The Dalles.In 1970, the Bonneville Power Administration opened the Celilo Converter Station near the northern terminus of the Pacific DC Intertie which sends 3,100 megawatts of electricity to Los Angeles. In 1982, a curly-coated kitten was born on a farm in The Dalles owned by Linda and Dick Koehl.

The Koehls used this kitten and her offspring to develop a new breed of cat called the LaPerm, which went on to become a popular, established, championship pedigree cat breed around the world.In 1984, The Dalles was the site of the first and single largest bioterrorism attack in United States history. In 1986, Penalty Phase, a film starring Peter Strauss and Melissa Gilbert, was filmed in and around The Dalles.In 2018, Terry A.

Davis, creator of the TempleOS operating system, walked from Portland, Oregon to The Dalles in three days via the Columbia River Gorge. There, he was struck by a train and died at the age of 48.