Article IV, Section 3, Clause 2:
The Congress shall have Power to dispose of and make all needful Rules and Regulations respecting the Territory or other Property belonging to the United States; and nothing in this Constitution shall be so construed as to Prejudice any Claims of the United States, or of any particular State.
In the territories, Congress has the entire dominion and sovereignty, national and local, and has full legislative power over all subjects upon which a state legislature might act. 1 It may legislate directly with respect to the local affairs of a territory or it may transfer that function to a legislature elected by the citizens thereof, 2 which will then be invested with all legislative power except as limited by the Constitution of the United States and acts of Congress. 3 In 1886, Congress prohibited the enactment by territorial legislatures of local or special laws on enumerated subjects. 4 The constitutional guarantees of private rights are applicable in territories which have been made a part of the United States by congressional action 5 but not in unincorporated territories. 6 Congress may establish, or may authorize the territorial legislature to create, legislative courts whose jurisdiction is derived from statutes enacted pursuant to this section other than from Article III. 7 Such courts may exercise admiralty jurisdiction despite the fact that such jurisdiction may be exercised in the states only by constitutional courts. 8