The exploitation of Louisiana's petroleum and natural gas resources in the early 1900's aided industrialization. After Huey P. Long was elected governor in 1928, the state began a vast program of public improvements, aid to education, and help for needy residents that resulted in unprecedented tax burdens. Long functioned as a dictator and dominated state affairs even after he became a United States senator in 1931. He was assassinated in 1935.

Louisiana prospered during World War II, increasing its mineral production and manufacturing. In the 1950's it held out strongly against ending racially segregated public-school systems. However, federal court orders in 1960-61 made desegregation unavoidable. By the early 1970's more than two-thirds of the state's students were attending integrated schools.

In 1963, the Mississippi River-Gulf Outlet opened, providing shippers with a 44-mile shortcut between New Orleans and the Gulf of Mexico via a 76-mile canal. The same year a project was completed to keep the Mississippi River from moving away from Baton Rouge and New Orleans; this included a dam, floodway, and levees built by the Army Corps of Engineers.

A new constitution, designed to streamline state government and to strengthen local government, was adopted in 1974 and became effective in 1975. In the 1980's, the state suffered from a depression in the oil industry. In 1991, casino gambling was legalized in selected areas and video poker was legalized statewide. In 1996, however, half the parishes in the state banned video poker machines.

In August, 2005, Hurricane Katrina hit the Gulf Coast. It killed more than 1,500 people in Louisiana and caused widespread damage. New Orleans was particularly hard-hit.