He led many raids and skirmishes against other Indian tribes and against white settlers who were moving into the territory in increasing numbers. In addition to Red Cloud's status as a warrior among the Sioux, he was also beginning to prove himself as an able leader. By age 40 Red Cloud was the recognized leader of the Bad Faces Oglala, and was hailed as a great chief of the Sioux by the white men. .
In the mid 1860's the discovery of gold in Montana and the opening of the Bozeman trail drastically increased the number of white settlers and miners traveling through Sioux country. The Indians resented this intrusion and began to attack wagon trains and white settlements, and the rising number of attacks along the Bozeman trail finally forced the United States government to take action. After several failed attempts to subdue the Indians by force, the government resorted to offering them a peace treaty that, among other things, would guarantee the safety of whites on the Bozeman trail. In June of 1866, Red Cloud and his band rode to Ft. Laramie in Wyoming to attend the council with the government commission. Many of the other Sioux chiefs were there as well as chiefs from the Cheyenne and the Arapaho Indians. As the council was getting underway, Colonel Henry B. Carrington, charged with protecting the trial after the treaty was signed, arrived at Ft. Laramie with the Second Battalion of the 18th Infantry. Red Cloud upon seeing Carrington, immediately jumped up and accused the government commission of duplicity, ""The Great Father sends us presents and wants us to sell him the road, but the White Chief [Carrington] goes with soldiers to steal the road before the Indians say Yes or No"" (Olson 36). Red Cloud then gathered his followers and left the council. .
For the next two years, Red Cloud and his growing band made war on the whites. They attacked settlements, wagon trains, and skirmished with Carrington's troops on several occasions.