Chili powder was invented in Texas; by whom is a matter of some dispute. The chili historian Joe Cooper maintains that a German immigrant named William Gebhardt invented the first chili powder in 1896 in the town of New Braunfels, which lies between Austin and San Antonio. Gebhardt operated a cafe in the back of a place called Miller's Saloon and devised a way of pulverizing Mexican dried chiles using a meat grinder (probably in an adaptation of the Hungarian method for making paprika). He sold his new product as Tampico Dust but later changed the name to Gebhardt's Eagle Chili Powder, as it is still called today. The foodstuff, which spared home cooks the laborious task of drying the chiles and pulverizing them by hand, became extremely popular throughout Texas and, later, the rest of the United States.

Other accounts point to a man named DeWitt Clinton Pendery as the powder's inventor. In 1870 he opened a dry goods store in Fort Worth called the Mexican Chilley Supply Company, and in 1890 he marketed a seasoning powder called Chiltomaline. Although it had apparently beat Gebhardt's to the punch by a few years, Pendery's product failed to catch on. "It is well said," he is reported to have remarked, "that few persons appreciate the benefits to be derived from the use of [chili powder]." We count ourselves among those who do.