
After emigrating to the United States in 1876, and soon after arriving in Lincoln County, he met Alexander McSween, with whom he would set up J. H. Tunstall & Co, a shop and bank close to the Murphy & Dolan mercantile and banking operation established by James Dolan, Lawrence Murphy and John H. Riley. Tunstall and McSween were supported by John Chisum, the owner of a large ranch and over 100,000 head of cattle.
Dolan attempted to goad Tunstall into a gunfight, and Tunstall recruited Billy the Kid to help him settle the dispute. On 18th February 1878, however, Tunstall was killed by William Morton, Jesse Evans and Tom Hill, apparently on the orders of James Dolan. This event ignited the Lincoln County War. Deeply affected by his murder, Billy the Kid joined the Regulators, a group that supported Alexander McSween. He claimed that Tunstall "was the only man that ever treated me like I was a free-born and white", and at his funeral swore: "I'll get every son-of-a-bitch who helped kill John if it's the last thing I do."