Thirty-four years after its founding, Laredo boasted 800 inhabitants, including españoles, mestizos, mulatos, and indios. In this stratified society, prominent Spanish landowners were granted the title of don and doña. Mulatos and Indios occupied the roles of servants, shepherds, and stock handlers.

Ranching and trading became the sustenance of the colony. Products were hauled from the Mexican interior through Laredo to San Antonio de Bexar and La Bahía. Cattle hides and wool were traded south in exchange for food and household necessities.

The Texas cowboy, or vaquero, had his roots in Spanish-Mexican ranching traditions. During the Spanish colonial period, the city government regulated round-ups to insure the proper distribution of wild cattle. Spanish brands, many resembling Moorish and Indian designs, were publicly registered. Located near springs and creeks, family-operated ranches such as Los Ojuélos, Dolores, and San Joseé de Palafox developed into small communities.

Laredo was struggling to survive the raids of Comanche and Apache Indians in 1821, the year Mexico gained its independence from Spain. To gain prestige and reap the spoils of war, the nomadic Plains Indians waged hit and run warfare against the Mexicans. The Indians wiped out near by ranchos as the pleas for additional garrison troops were ignored.

Carrizo Indians, a group of Coahuiltecan peoples, lived in thatched huts and practiced a hunting-gathering existence using the bow and arrow. Reduced by disease and warfare, the Carrizos became Christians and slowly assimilated into Spanish Culture.