What was the outcome of Gibbons v. Ogden in relation to federalism?

The outcome of Gibbons v. Ogden significantly shaped the relationship between federal and state powers, particularly in the area of commerce. The Supreme Court, through this landmark case decided in 1824, established the principle that the federal government has the authority to regulate interstate commerce under the Commerce Clause of the Constitution. This decision reinforced the supremacy of federal law in the arena of interstate trade, thereby limiting the ability of individual states to create conflicting regulations that could hinder or obstruct commerce crossing state lines.

The case involved a dispute between two steamboat operators over navigation rights in New York waters and the federal coasting license issued by Congress. The Court ruled that since the steamboats engaged in interstate commerce — traveling between New York and New Jersey — the federal law governing commerce took precedence over state regulations.

This ruling underscored the idea that while states have power to regulate their own affairs, particularly those that do not affect interstate commerce, the federal government retains the superior authority to regulate any economic activity that crosses state boundaries. This principle has been critical in defining the balance of power in American federalism, particularly in how economic activities are governed across state lines.