How was land divvied out to settlers in the US during colonization? Was there ever a point where it was sold by the local or federal government?

by Encouragedissent
conpermiso

Yes. The Northwest Ordinance of 1787 is a prime example of this. Created by the Congress under the Articles of Confederation (precursor to the modern Constitution), the Ordinance handled the expansion of the states into the Northwest Territory comprised of what are today Ohio, Illinois, Indiana, Wisconsin, Michigan, and Minnesota.

The law set the rules for navigable water ways, the means for creating new states from that land, and also provided for the sale of parcels of land. Interestingly, this included the first federal effort to fund education, "Congress granted more than 77 million acres of the public domain as an endowment for the support of public schools through tracts ceded to the states. " The idea was that the sale of those acreages would be used to fund schools in the territories.

Eighty years later, we'd see the Homestead Acts, which sold parcels of 160 acres to person who would inhabit and improve on the land for a term of years. This land was sold directly from the Federal government's holding in unorganized territory, a precedent which was set by the Northwest Ordinance!

The National Archives has three excellent primary sources, listed with my sources below, detailing the journey of one mans purchase, improvement and eventual claim on land he purchased through the Homestead Act. These improvements included building a 12x14 dwelling, planting crops, and residing there for five years.

If you happen to be a college football fan, you may know the terms "Boomer" and "Sooner" and their context with Oklahoma University. This is actually a reference to the Indian Appropriations Act of 1889, in which the federal government sold off seized Indian lands in the former Indian territory (now Oklahoma). At the sound of a cannon, prospective settlers were to race in and claim their land. Boomers waited for the official start, whereas Sooners jumped the gun and illegally claimed before the start of the sale.

Those are just three examples that spring to mind. Here are some sources, I hope this piqued your interest!

Education and the Northwest Ordinance

The Northwest Ordinance of 1787

one applicants story of the Homestead Act of 1862

Boomers, Sooners, and the Indian Appropriation Act of 1889

TeamRedRocket

I can talk a bit about post-independence land sales. You mentioned federal which is period after constitution came into force.

Anyway, as an example in Georgia in 1795 they had the Yazoo Land Fraud. After Revolutionary War, Georgia had claim to large parcels of land in it's far western areas (modern-day Mississippi) but didn't have the manpower to properly control it.

To raise money, the legislature passed the Yazoo Act, which sold large areas of land (around 35m acres) to investors. Once the fact that bribes were used to ease passage of the law, the Rescinding Act of 1796 was passed, which repealed the land sales.
Eventually, SCOTUS decided that this law interfered with right of contract, and the Federal Gov't paid several million dollars to settle land claims since Georgia ceded the territory to it. The end result is directly led to creation of Alabama and Mississippi. Speculatively, it also led to rise in 'states rights' since some felt like the federal government and the SCOTUS in particular shouldn't have interfered in the contract nullification. (I don't have any hard data to back that up, except in what politicians were elected in response to Yazoo Act)

Source: Politics on Periphery by George Lamplugh

WBTheorist

The other comments so far seemed to address the early republic more than colonial land distribution - hopefully this will add the colonial period back into the discussion.

The terms of all colonial land distributions and sales were determined by the various colonial charters. Especially in the early years of settlement, there was some variation in the forms of these charters, and specific rights or "liberties" were granted to the settlers by the crown - all sovereignty and land-ownership, in this sense, remained theoretically with the monarch.

Basically there were three major types of colonial charters that could result in strikingly different methods of land distribution - corporate charters, royal charters, and proprietary charters.

Corporate charters were issued to groups or corporations of investors in colonization, for example the Virginia Company or the Massachusetts Bay Company. These typically granted the company's board of directors the right to distribute land (and full membership in the corporation, along with the political rights this entailed) as they saw fit. Obviously, colonial settlements with different goals would distribute this property differently. For example, the Massachusetts Bay government generally left the distribution of available land to individual townships, and tended to support a more equitable distribution of property in keeping with their goal of creating a godly republic. [See Michael Winship's "Godly Republicanism" (2012); Daniel Vickers, "Farmers and Fishermen" (1994)] The Massachusetts Bay Puritans also made the critical decision to bring their charter to the New World with them, so that potential enemies back in England couldn't meddle with it - THAT's how important charters were!

In Virginia, on the other hand, all property initially belonged to the Virginia Company, and almost no land was distributed to actual settlers before 1619. Once Virginia began to move away from its initial focus on finding gold, land ownership and the production of tobacco became the basis of the economy, necessitating a shift in patterns of property ownership. Still, the majority of land continued to be held by a few of the "old planters," a pattern that was reinforced by Virginia's transition to a royal colony (more on that below) in 1624. By the mid-1620s, Virginians also instituted the headright system which granted an additional 50 acres of land to any planter who could import bound laborers (at that time primarily English indentured servants but increasingly slaves over the course of the 17th century). [See James Horn, "Adapting to a New World" (1996); Edmund Morgan, "American Slavery, American Freedom" (1976); and MANY others on colonial VA] These kind of major variations in the processes for distributing land were a function of the broad leeway given to colonial governments in structuring their local law - as long is it was not "repugnant" to English law, colonists could adapt legal precedents to suit their particular conditions or goals.

Royal and Proprietary colonies became the dominant mode of organizing the English colonies following the Stuart Restoration in 1660. The empire had become far too important to the financial health of the metropole to allow local colonists or corporate boards of directors to tinker with. All royal colonies were overseen directly by the crown (typically by the Privy Council, and later, the Councils for Trade and Plantations) and all colonial laws, including those touching on land distribution, were subject to royal approval. Royal colonies were also often used to reward the king's favorites with large land grants or special trading privileges. In a similar vein, proprietary colonies were directly granted (in almost feudal fashion) to particular royal favorites, for example Lord Baltimore in Maryland or William Penn in Pennsylvania. These Lords Proprietors would govern in the king's name in these proprietary colonies, but had a bit more leeway in framing their local laws.

In theory, the sale of landed property was legal in all of these colonies, particularly once English common law and greater royal oversight were established throughout the empire in the 1690s, as long as the procedures for alienation, devise, or descent followed English common law norms and procedures.

You can get see all the colonial charters, as well as the state constitutions created after the Revolution, in Francis Newton Thorpe's "Federal and State Constitutions, Colonial Charters, and other Organic Laws" (1909) - a key collection of primary sources for anyone interested in colonial or early national history. [There are a number of volumes of Thorpe available online through Google Books and archive.org]

Hope this helps to answer your question.