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When Austin was eleven years old, his family sent him back east to be educated, first at the preparatory school of Bacon Academy in Colchester, Connecticut, and then at Transylvania University in Lexington, Kentucky, from which he graduated in 1810.
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After Moses Austin's death in 1821, Stephen Austin won recognition of the empresario grant from the newly-independent state of Mexico.
Austin convinced numerous American settlers to move to Texas, and by 1825 Austin had brought the first 300 American families into the territory.
Over the next few months, Little Rock did become the territorial capital, but Austin's claim to land in the area was contested, and the courts ruled against him.
The Territorial Assembly reorganized the government and abolished Austin's judgeship. He reached New Orleans in November 1820, where he met and stayed with a New Orleans lawyer and former Kentucky congressman, Joseph H. He directed that his empresario grant would be taken over by his son Stephen.