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In the Civil War, both economies were greatly affected by the Industrial Revolution. The Industrial Revolution introduced key inventions important to both the Northern and Southern economies. It produced telegraph, factory inventions, and the cotton mill. In the North, were a colder climate and less fertile ground existed, they focused on more factories and Urbanization, and inventions that improved the time and effort needed in making things like textiles strengthened the North's dependence economically on such products. The South's land was fertile, and though many of the farming population that owned land produced produce for the local market, the majority of the South's economy was based on the farmers that ran the larger plantations. These plantations required slaves for the production of large cash crops like cotton and tobacco. The introduction of the cotton gin increased manufacturing and also the demand for raw materials.

In short, the Northern economy was based on factories, and the South was more plantationgrown.

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