Jay Treaty, or Jay's Treaty, a treaty negotiated and signed in 1794 by John Jay, United States special envoy, and Lord William Grenville, British foreign secretary, to settle mutual grievances. Britain was at war with revolutionary France. The United States was neutral despite its alliance with France dating from the American Revolutionary War.
Britain agreed to evacuate military and trading posts in the Northwest Territory that it was holding in violation of the peace terms of 1783. Four joint commissions were created to settle boundary disputes and money claims. Britain made some commercial concessions toward freer trade with the United States. The United States agreed not to allow French privateers to seek refuge and supplies in its harbors. Both nations declared their support for free navigation on the Mississippi River.
Public opinion in the United States was outraged by the treaty. Jay had not challenged British impressment (forcible enlistment into naval service) of United States merchant sailors, nor had he gotten Britain to agree to recognize the rights of neutrals during wartime. Jeffersonian Republicans argued that the treaty violated the Franco-American alliance. After heated debate, the Senate ratified the Jay Treaty in 1795, by the bare two-thirds vote necessary.
Most historians believe that the terms, though far from ideal, were the best possible. The Jay Treaty prevented war with Britain and brought prosperity to merchants. It also led to the Pinckney Treaty with Spain, granting free navigation on the Mississippi. (The Spanish hoped to improve relations with the United States, fearing a joint Anglo-American attack on Spain's colonies in North America.) Relations between the United States and France, however, worsened.