Montana passed its first laws related to fish regulation in 1864, governing the manner in which fish could be caught. Additional laws governing fish were passed in the ensuing years and fish stocking occurred in many rivers and lakes, but it was not until 1896 that the first fish hatchery was built in Montana. Located on Bridger Creek near Bozeman, this hatchery was built by the federal government and operated under the direction of Dr. James Henshall. In 1901 the Montana Department of Fish and Game was organized, with W. F. Scott appointed as the first State Game Warden. By 1907 regulations on fishing were on the rise, with the requirement of a license for both resident and non-resident fisherman.

The first state fish hatchery was approved by the 1907 Legislative Assembly and was built in Anaconda in 1908 under the direction of C. F. Healea. The Anaconda hatchery was credited with noticeably increasing the number of fish in Montana streams and produced primarily blackspotted or cutthroat trout. Additional hatcheries were built in the ensuing years, including those at Somers (1912), Emigrant (1919), Lewistown (1922), Great Falls (1922), Big Timber (1922), Red Lodge (1922), and Ovando (1922). In 1913 the position of hatchery superintendent was created to oversee the expanded fish hatchery program. The first superintendent was H. D. Dean. The first fisheries biologist was requested in 1924, but not hired until 1947.

Additional fish hatcheries were built throughout the next decade, including the Miles City Pond Culture Station and the Ennis fish hatchery in 1933. Also during the 1930s, under Superintendent K. F. MacDonald, the division initiated a survey crew to study streams in the hatchery areas. Several spawning stations, including those at Flint Creek, Stewart Mill Creek, Ashley Lake and Hebgen Lake, were constructed. Several additional construction projects at the various hatcheries were completed during the 1930s through assistance from federal relief work programs.

In 1947 a biology section was created in the Fisheries Division, headed by C. K. Phenicie, to implement more scientific studies of the hatcheries in the state. Additional hatcheries were constructed in the following years and educational programs were developed within the division to educate the public on fish and fisheries. During the 1950s several dams were constructed in Montana that effected the development of the fisheries division in Montana; these include the Tiber Dam and the Canyon Ferry Dam. Also during this time, the fisheries division was changed from having several district-based supervisors to one statewide hatchery supervisor. Pollution was recognized as a problem in 1957 and appropriate staff positions were created to address it.