In the case of Yankton Sioux Tribe of Indians v. United States (1926), the U.S Supreme Court ruled that a 1892 agreement between Congress and the Yankton Sioux Tribe resulted in a cession, not merely a reduction, of their reservation lands. The tribe had argued that they only agreed to sell surplus land outside their reduced reservation boundaries but retained sovereign control over remaining lands within those boundaries. However, the court found that both parties intended for all unallotted lands to be sold and opened for settlement by non-Indians under public law. Therefore, these areas were no longer part of Indian Country subject to tribal jurisdiction or federal protection as reservations are typically afforded.

In the dissenting opinion for Yankton Sioux Tribe of Indians v. United States, Justice Holmes argued that the majority's decision was based on a misinterpretation of the 1894 Act and its intentions. He believed that Congress intended to preserve tribal ownership over unallotted lands until they were sold or otherwise disposed of by law, rather than immediately transferring them into public domain upon ratification of the agreement. The justice contended that this interpretation was supported by both historical context and legal precedent regarding Indian land rights. Furthermore, he criticized the majority's reliance on subsequent legislative acts as evidence against tribal ownership, arguing these should not be used retroactively to interpret earlier laws' intent. In his view, if Congress had truly intended to terminate all reservation status in 1894 it would have done so explicitly; since it did not do this but instead provided for future disposition of unsold lands under federal control - which implies continued reservation status - such an intention cannot be inferred.