With the discovery of gold in Colorado and the resulting influx of miners, Indian-white relations deteriorated. Finally, in the spring of 1878, Nathan Meeker, an Indian agent, triggered a series of events that led to the relocation of Ouray's people to Utah. The White River Utes had become infuriated over Meeker's attempt to force them to farm. Meeker called in federal troops, but the Indians succeeded in killing him and seven other whites and took several women as captives. When the government appealed to Ouray for help, the influential chief intervened and secured the release of the hostages and even welcomed them into his home while the situation was defused.
Repercussions from this incident were devastating for the Indians. In 1880 Ouray traveled for the last time to Washington where he signed a treaty providing for the removal of the White River Utes as well as his own Uncompahgre band from Colorado to the Uintah and newly created Ouray reservations in Utah. Shortly after his return from Washington, Ouray died and was buried in southern Colorado. His wife, Chipeta, moved to Utah with her people and died in poverty and exile in 1924 on the reservation named for her husband.