During Pennington's time as governor, the gold rush was starting in the Black Hills; Jack McCall was tried and hanged in Yankton for the murder of "Wild Bill" Hickok; and, railroad construction and immigration had both slowed.

In the spring of 1877, Judge Granville was assigned to the Black Hills judicial district; and as a result, the separatist movement ended.

Because of his lack of popularity in the Black Hills and negative reports on his character in Yankton, Pennington was replaced by William Alanson Howard as Governor of Dakota Territory in April 1878.

In September 1883, Pennington attended the constitutional convention in Sioux Falls, where he opposed dividing Dakota Territory into two states.

Pennington was a journalist; the house is now home to South Dakota Magazine, a publication that explores the history and culture of the state.