The political deadlock during Nepal’s constitution-writing process in 2012 was polarized around which two prominent notions of the environment should form the basis for state restructuring. The alliance of indigenous and marginalized groups wanted recognition of and autonomy in their ancestral homelands. But the major mainstream political parties wanted equal distribution of natural resources. Studies of the indigenous state struggle have underscored the significance of recognizing indigenous sovereignty. Similarly, studies in political ecology have highlighted subject formation in state-environment relations. However, the fundamental implications of state sovereignty for indigenous people remains under-discussed in either of these frameworks of multiculturalism and governmentality. This dissertation shows that the creation of nature as an environment detached from human existence produces state sovereignty through the exclusion of indigenous peoples. I demonstrate this through history and environment at the intersection of the Limbu indigenous movement and environmental conservation strategies in Kanchanjunga Conservation Area (KCA) in Eastern Nepal. Based on my ethnographic fieldwork, interviews, and historic legal document analysis in Nepal between 2015-2018, I demonstrate that the KCA’s identity as a protected space of nature is the source of government control, despite the formal devolution of conservation responsibility to the local KCA Management Council. I show that defining “development” in conservation as an approach that only addresses infrastructural needs and that improves financial literacy for people requires the selective omission of Limbu-state history. The Council’s legal source of legitimacy is intertwined with the Council’s challenges in exercising its authority when faced with the Limbu history-based property claims. I argue that analyzing kipat as the Limbu-state history of land struggle illustrates the process of kipat’s transformation into property. Tracing this process means also following the history of the creation of nature and government authority. I argue that the state’s colonial power that is formed through environmental transformation, such as nature and property, leads to increased state control. This process acquires legitimacy through constant negation of the contemporaneity of claims for indigenous people. I show this by examining Limbu stories, mundhums, as the basis of current Limbu claims of animism. The contemporaneity of mundhums’ authority in Limbu life exposes the colonial ramifications of the uncritical adoption of state sovereignty in the KCA.