In 1883 Joseph Pulitzer purchased New York World for $346,000. The newspaper was turned into a journal that concentrated on investigative reporting, human-interest stories, scandal and sensational material. Pulitzer also promised to use the paper to "expose all fraud and sham, fight all public evils and abuses, and to battle for the people with earnest sincerity".

In 1895 William Randolph Hearst purchased the the New York Journal, and using the similar approach adopted by Joseph Pulitzer, began to compete with the New York World. Pulitzer responded by producing a colour supplement.

The colour supplement included the Yellow Kid, a new cartoon character drawn by Richard F. Outcault. This cartoon became so popular that William Randolph Hearst, owner of the New York Journal, offered him a considerable amount of money to join his newspaper. Hearst also reduced the price of the journal to one cent and including colour magazine sections. As a result of the importance of Outcault's Yellow Kid character in these events, this circulation war between the two newspapers became known as yellow journalism. He also persuaded Frederick Opper, another of Pulitzer's cartoonists, to join the New York Journal.

The tactics used by the New York Journal and the New York World increased circulation and influenced the content and style of newspapers in most of the USA's major cities. Many aspects of yellow journalism, such as banner headlines, sensational stories, an emphasis on illustrations, and coloured supplements, became a permanent feature of popular newspapers in the United States and Europe during the 20th century.