The population of Yellowknife quickly grew to 1,000 by 1940, and by 1942, five gold mines were in production in the Yellowknife region. However, by 1944, gold production had ground to a halt as men were needed for the war effort. An exploration program at the Giant Mine property on the north end of town had suggested a sizable gold deposit in 1944. This new find resulted in a massive post-war staking rush to Yellowknife. It also resulted in new discoveries at the Con Mine, greatly extending the life of the mine. The Yellowknife town site expanded from the Old Town waterfront, and the new town site was established during 1945–1946. The Discovery Mine, with its own town site, operated 81 km (50 mi) to the north-northeast of Yellowknife from 1950 to 1969.
Between 1939 and 1953, Yellowknife was controlled by the Northern Affairs department (now Indian and Northern Affairs Canada) of the Government of Canada. A small council, partially elected and partially appointed, made decisions. By 1953, Yellowknife had grown so much that it was made a municipality, with its own council and town hall. The first mayor of Yellowknife was John "Jock" McNiven. In September 1967, Yellowknife officially became the capital of the Northwest Territories. This important new status sparked what has been coined as the third boom in Yellowknife. New sub-divisions were established to house an influx of government workers.
In 1978 the Soviet nuclear-powered satellite Cosmos 954 crashed to Earth near Yellowknife. There were no known casualties, although a small quantity of radioactive nuclear fuel was released into the environment, and Operation Morning Light—an attempt to retrieve it—was only partially successful. A new mining rush and fourth building boom for Yellowknife began with the discovery of diamonds 300 km (190 mi) north of the city in 1991. The last of the gold mines in Yellowknife closed in 2004. Today, Yellowknife is primarily a government town
