Although mining began in the Barkly region following the first geological expedition of the area in 1894, the discovery of gold by a Warumungu man, Frank Juppurula, in 1932 provided the impetus for the first rush to Tennant Creek. Several mines were quickly established and by 1934 the Tennant Creek Goldfield was proclaimed encompassing 2,146 square miles. Although the original Warramunga Reserve laid outside this goldfield lease, miners easily moved into the lands. In 1934 anthropologist W.E.H. Stanner commented on the failure of the Warramunga Aboriginal Reserve, saying, ‘it is idle to pretend that there has been any sanctity about the Aborigines' Reserve’ (1980, 43).

Early in 1936 two treatment plants were erected and by the end of the year two government batteries were opened. Miners moved freely in the area ignoring the Reserve boundaries and by 1939 the original Tennant Creek Goldfield lease was cancelled and a larger area, some 35,500 square miles, more than ten times the original lease, was proclaimed as the Warramunga Goldfield. Paid only in rations, Warumungu people did not benefit from the mining on their lands, although their labor was essential to this risky and expensive business. Warumungu men and women worked in the mines for years, leaving their families at Seven Mile or camped nearby.

As the mines multiplied so did their reliance of Aboriginal labor. In 1935 Phillip Ward discovered Blue Moon Mine. For the first four years of operation the mine did reasonably well. But, in 1940, Ward struck a ‘phenomenally rich deposit’ with an initial find of 440 tons of gold, yielding 2,400 ounces, with a total of 8700 ounces by the year's end. The Central Australia Options N.L. was formed and later that year Ward sold the mine and bought several cattle stations with the proceeds, including Banka Banka Station. Many of these mines made their owners quite wealthy, while the Aboriginal communities were denied compensation for their land and labor.