Analyzing the processes of Argentinean and Chilean colonization of southern Patagonia, a territory that remained unsettled by European powers, this dissertation seeks to understand `frontier expansion' as part of a world-wide imperial impulse in late 19th century. Based on metropolitan and local archival work, this dissertation develops a transnational as well as a comparative approach to the regional formation of those States, by following the flow of people and capital to Patagonia. In doing so, it also explores the impact of imperial knowledge in the formulation of national policies, arguing that the region remained a marginal area with very weak State presence, in spite of its centrality in the nationalist imaginaries. Early efforts at penal, administrative, and racial colonization invariably ended in failures. A radical shift took place in the 1880s, however, after an invasion of people and animals from the British colony of Malvinas (Falklands). The landing of sheep meant the start of an accelerated process of State and capital formation, which radically transformed the social and ecological landscape. I argue that it was the articulation of networks of racism and corruption, linking Argentina's and Chile's metropolitan oligarchies and European immigrants that defined the pace of colonization. This expansion resulted in the rise of working class and regional identities across a vague border around 1910. The multinational workers' insurgency challenged the overwhelming power of monopolies and its alliance with local functionaries. Paradoxically, however, discourses of social mobilization were increasingly framed in nationalist terms, and a bloody crack-down in 1920-1922 resulted in a decisive divide between Chilean and Argentine sectors. Overall, the dissertation aims to contribute to borderland studies, addressing the intimate relationship between state and capital accumulation in a colonial/postcolonial setting.