When the question of territorial organization came up in the United States Senate the name “Jefferson” was promptly turned down. The list of proposed names included “Tampa,” “Idaho,” which was the name first accepted, “Nemara,” “San Juan,” “Lula,” “Arapahoe,” “Weappollao,” “Tahosa,” “Lafayette,” “Columbus,” “Franklin” and “Colona.” When the bill was about to pass, the name “Colorado” was ordered substituted for that of “Idaho.” On February 28, 1861, President Buchanan signed the bill creating the Territory of Colorado.
The name “Colorado” is the past participle of the Spanish verb “Colorar,” “to color,” with a secondary meaning of “ruddy” or “blushing;” and was originally applied by the Spaniards to the Colorado river, whose water is red in hue when swollen by the heavy rains from the disintegration of the reddish soils through which it flows.
From “History of Larimer County, Colorado,” by Ansel Watrous, 1911 and “History of Colorado,” by Wilbur Fisk Stone, 1918.