In 1921, J. Starnes returned from the war, married, and brought his wife to the area, making her the first white woman to live in Bear Canyon. They built a home on the river flats and successfully planted one of the region's first gardens, proving that hardy vegetables and small fruits could thrive in the microclimate.

In October 1929, the University of Alberta sent out its first field survey party, headed by Ottawa Yonge with guide Herb Foster. Shortly after, Foster led a group of land-seekers—including John Howe, Chauncey Berge, Bertyl Jonsson, and Howard Davitt—into the region to stake claims.

Throughout the early 1930s, more families arrived from places like Saskatchewan and other parts of Alberta to take up homesteads, laying down roots despite the lack of infrastructure. Because of its isolation, development in Bear Canyon relied heavily on community resourcefulness. Early travel required navigating rough terrain. The first local road was cut around 1928 from Starnes’ boat landing up "Big Bear hill". Road conditions remained primitive for decades, heavily reliant on local snow-plowing efforts until the government officially took over road maintenance in the mid-20th century.

Initial dwellings were basic log cabins chinked with mud. Later, local sawmills (such as one operated by settler P. Erickson) provided frame lumber. The Post Office opened October 1, 1959. The first postmaster was Albin Erickson, who held the position until 1964.

Early commerce was similarly grassroots; the first local store was operated by the Erickson family right out of their grain granary. As fur populations declined, the community shifted toward mixed farming, livestock, and grain production. The post-WWII introduction of heavy machinery (like tractors and brush-cutters) in 1949 drastically accelerated land-clearing and agricultural output.