The craft distilling industry in America has undergone a large vitalization in the past several decades. Due to the fact that between the national prohibition and this recent development there were nearly no legal craft distillers in the U.S. this industry can be considered a model of the birth and early development of an industry. This study identifies several factors that have contributed to the birth and early rise of the craft distilling industry in America and outlines how each has affected this development. These factors can be organized into four categories: institutional influences, networking effects, competitive dynamics and learning effects. I hypothesize that each factor discussed has a positive affect on the development of the industry. This qualitative study consists of nine semi-structured interviews with nine craft distillers from the Pacific Northwest. The data received provides support for most of my hypotheses. It is concluded that most of the factors outlined in this study do, indeed, provided support for the development of the craft distilling industry. However, several factors only received partial support from the data. In addition, the subjects pointed to several additional factors that were not predicted by this study but that also aided the rise of the industry. These factors are presented in a separate section and their relation to the theories presented in this study are outlined. The main conclusion proposed in this study is that the birth and development of this infant industry is a product of many interrelated forces and it is only possible to gain a full understanding of each factor by taking into account the influences of each other element.