For the adjacent park, see Fort Steilacoom Park Fort Steilacoom was founded by the U.S. Army in 1849 near Lake Steilacoom. It was among the first military fortifications built by the U.S. north of the Columbia River in what was to become the State of Washington. The fort was constructed due to civilian agitation about the massacre in 1847 at the Whitman mission. Fort Steilacoom was decommissioned as a military post in 1868. In 1871 Washington Territory repurposed the fort as an insane asylum, with the barracks serving as patient and staff housing. Fort Steilacoom is now Western State Hospital.