After years of financial struggle, the university's campus was badly damaged by fire, the school was foreclosed on by its creditors, its classes ceased in 1886, and it no longer admitted students.

[3] The land upon which the Old University of Chicago was established was originally part of a lakefront tract owned by Senator Stephen A. Douglas.

Douglas had offered the 10-acre (4.0 ha) plot, worth $50,000 and located at Cottage Grove Avenue and Thirty-Fifth Street, to the Presbyterian Church for a seminary.

Fundraising was hurt by Douglas' support for the Kansas–Nebraska Act, which was regarded by many northern Baptists and other abolitionists as a betrayal,[5] while the financial Panic of 1857 drained the finances of many of the principal investors, rendering most of their initial subscriptions worthless.

The trustees proceeded with plans to build the university, including construction projects that were beyond the school's means because of the volatility of the market.

To keep Burroughs affiliated with the university, the trustees created the post of chancellor and appointed him responsible for the school's financial affairs.

The university's fifth president, Galusha Anderson, appealed to philanthropists John D. Rockefeller and Leland Stanford, but was unable to secure substantial donations.

This was to enable a new Rockefeller-financed Baptist school, then being organized, to have a completely separate legal entity and take the title of the University of Chicago.

The stone was removed from the wall and archived by the university in July 2020 in response to concerns regarding the old Douglas Hall benefactor's association with slavery.