Punta Arenas is a commune and the capital city of Chile

Chile

Chile ,officially the Republic of Chile , is a country in South America occupying a long, narrow coastal strip between the Andes mountains to the east and the Pacific Ocean to the west. It borders Peru to the north, Bolivia to the northeast, Argentina to the east, and the Drake Passage in the far...

's southernmost region, Magallanes and Antartica Chilena. The city was officially renamed Magallanes in 1927, but in 1938 it was changed back to Punta Arenas. It is the largest city south of the 46th parallel south

46th parallel south

The 46th parallel south is a circle of latitude that is 46 degrees south of the Earth's equatorial plane. It crosses the Atlantic Ocean, the Indian Ocean, Australasia, the Pacific Ocean and South America....

.

Sitting by the Strait of Magellan

Strait of Magellan

The Strait of Magellan comprises a navigable sea route immediately south of mainland South America and north of Tierra del Fuego...

 Punta Arenas was established originally as a tiny penal colony

Penal colony

A penal colony is a settlement used to exile prisoners and separate them from the general populace by placing them in a remote location, often an island or distant colonial territory...

 in 1848 but became during the 19th increasingly large and important as international trade across the straits grew and the countryside around experienced a gold rush

Gold rush

A gold rush is a period of feverish migration of workers to an area that has had a dramatic discovery of gold. Major gold rushes took place in the 19th century in Australia, Brazil, Canada, South Africa, and the United States, while smaller gold rushes took place elsewhere.In the 19th and early...

 and a sheep farming boom around 1900.