Somalia is a country of two realities: the internationally recognized Federal Republic of Somalia and the self-declared Republic of Somaliland. While the Federal Republic endures chronic instability and unrest, Somaliland has established security, economic growth, and a functioning government. This article argues that a significant contributing factor to this divergence is the radically different colonial regimes that ruled the two regions before their unification and independence in 1960. British rule in British Somaliland sought primarily to deny other empires control of the Protectorate and to trade livestock with the indigenous communities. Italy, however, engaged in a protracted and violent effort to establish a plantation colony in Italian Somaliland. Drawing from colonial-era sources and with a focus on the earliest years of imperial and Somali engagement, this article situates the long-run divergent trajectories of British Somaliland and Italian Somaliland within the broader literature on colonial institutions and long-run economic development.