The occupation of the state territory took place in several stages. The Jesuit reductions, founded from 1626 on, were the first steady nuclei within the State besides its original occupation by Indian tribes. Around 1640 the Jesuits abandoned the area and moved to the other bank of Uruguay river towards Argentine territory. About 40 years later, they returned, organizing the community structure of the Sete Povos das Missões (Seven Peoples of the Missions). These have become important economic centers, dedicated to the production of yerba maté (Ilex paraguariensis), extraction of leather and livestock raising.
In the XVIII century, the strategy adopted by the Portuguese Crown to guarantee the possession and defense of the territories located in southernmost Brazil was the installation of military camps and the construction of forts and prisons, as well as the distribution of land grants to influent people and/or militaries. Until half of the XIX century, Rio Grande do Sul developed livestock devoted to the production of jerked beef, a cycle that was responsible for the prosperity of the south of the State and the municipalities of Bagé, Pelotas and Rio Grande, among others.
The Azoreans arrived from 1752 onwards, settling in the municipalities of Rio Grande, Mostardas, São José do Norte, Taquari, Santo Amaro (near Rio Pardo), Porto Alegre, Santo Antônio da Patrulha, Cachoeira do Sul and Conceição do Arroio (Osório). They received lands to develop agricultural activities, mainly the production of wheat, and thus supply the Colony. Such occupation gave origin to small rural farms, and also created the basis for the emergence of several urban nuclei. During the whole XIX century, Rio Grande do Sul was influenced by the process of settlement of European immigrants, at first German (1824), and later Italian (1875), located mainly in the northeast of the State. As a result, this area became more dynamic, although livestock continued to be the center of the economic and political activity of the State. Further industrial diversification and the increasing urbanization of Porto Alegre-Caxias do Sul axis made this region be more attractive to entrepreneurs. The north of the state was basically peopled by the expansion of German and Italian colonial areas, and by the arrival of new ethnic groups. The diversified production of small farms created a less concentrated income distribution which resulted in an urban network formed by small close nuclei.
Therefore, the origin of the state territory occupation partially explains the differences in its population distribution. At south it is predominantly located in medium sized cities, reflecting the extensive activities of large farms that gave origin to rarefied spaces and a dispersed urban network. In the regions of small farms, especially north of the State, the fragmentation of the land led to a more dispersed political-administrative framework. Such land distribution results in increased population density in the north in opposition to the south.