In the early 1920s, the lumber mills ceased operating, commercial fishing had peaked and farming was not yet able to take up the slack. The area entered a local version of the Depression several years before the bust came to the rest of the nation. Several local business ventures attempted to fill some of the void left by the closing of the mills. A blueberry cannery, cigar factory and soda pop factory were among these shortlived ventures.
The early and mid-1920s saw the birth of the tourist industry in Lake of the Woods County, when resorts began to appear along the shores of the river and lake. Although several men had previously catered to a small number of tourists, providing guide and launch service, the Klimek family built the first local resort in the shelter of Four Mile Bay on the site of the present Wigwam Resort. Shortly after Klimeks started in business, Ed McGuire built a dance pavilion and resort on the river side of Wheeler’s Point and John Morris constructed a series of cabins at Morris Point, several miles west of the mouth of the river. In the following years, many more resorts were added along the shores of the Rainy River and the Lake of the Woods, and tourism started to generate revenue for the county.
It was in the decade of the 1930s that a nearly explosive development in local agriculture occurred. The fires of the 1930s, particularly 1931, prepared land for easier clearing. Technological advances had made available more effective tractors and farm equipment. An area normally marginally wet for crop production became very productive when the area as a whole was drier than usual. The new land was especially productive of legume seeds of extraordinary quality and purity which claimed a high price even during the Depression.
In the mid-thirties, Ted Rowell, Sr., started an industry based on a most unlikely resource, the burbot. Rowell discovered that the oil extracted from burbot livers was a rich source of certain vitamins and began manufacturing burbot liver oil products. In the years to come Rowell Laboratories went on to produce a range of pharmaceuticals and continues at the Baudette location today under the ANI Company.