Hundreds of thousands of African-Americans were in segregated units in World War I, mostly assigned to non-combat duties. The early American Legion left the question of integration, the formation of segregated "Negro" posts, or exclusion of black soldiers from membership altogether up to the states and the posts themselves, often resulting in gross disparities of opportunity.
The formal founding convention was held in Minneapolis, Minnesota from November 10 to 12, 1919. It was attended by 684 delegates from around the United States.
From the outset The American Legion maintained a strictly nonpartisan orientation towards electoral politics. The group wrote a specific prohibition of the endorsement of political candidates into its constitution, declaring:
...this organization shall be absolutely non-political and shall not be used for the dissemination of partisan principles or for the promotion of the candidacy of any person seeking public office or preferment; and no candidate for or incumbent of a salaried elective public office shall hold any office in The American Legion or in any branch or post thereof.
One semi-official historian of the organization has noted the way that this explicit refusal to affiliate with one or another political party had the paradoxical effect of rapidly building great political power for the organization, as politicians from both of the "old parties" competed for the favor of the Legion's massive and active membership.
One of the gathering's primary accomplishment was the establishment of a permanent National Legislative Committee to advance the Legion's political objectives as its lobbying arm. The first iteration of this official Washington, D.C.-based lobby for the Legion included only four members—two Republicans and two Democrats. After 1920 the National Legislative Committee was expanded to consist of one member from each state, with additional effort made at the state level to exert pressure upon various state legislatures.
Chief on the Legion's legislative agenda was a dramatic improvement of the level of compensation for soldiers who suffered permanent disability during the war. At the time of the end of World War I, American law stated that soldiers who suffered total disability were to receive only the base pay of a Private—$30 per month. The Legion concentrated its lobbying effort in 1919 on passage of legislation increasing payment for total disability suffered in the war to $80 a month—a sum roughly sufficient in dollars of the day to provide a living wage. Those partially disabled by their wounds were to receive lesser payments. A flurry of lobbying by the Legion's National Legislative Committee in conjunction with cables sent to Congressional leaders by National Commander Franklin D'Olier helped achieve passage of this legislation by the end of 1919.
The American Legion's chief base of support during its first years was among the officers corps of the reserves and the National Guard. The size of the regular army was comparatively small and its representation in the League in its earliest days was even more limited. Consequently, for nearly two decades The American Legion maintained a largely isolationist perspective, best expressed in three resolutions passed by the Minneapolis founding convention:
1. That a large standing army is uneconomic and un-American. National safety with freedom from militarism is best assured by a national citizen army and navy based on the democratic principles of equality of obligation and opportunity for all.
2. That we favor universal military training and the administration of such a policy should be removed from the complete control of any exclusively military organization or caste.
3. That we are strongly opposed to compulsory military service in time of peace.
Additional resolutions passed by the founding convention emphasized the need for military preparedness, albeit maintained through a citizens' army of reservists and National Guardsmen rather than through the costly and undemocratic structure of a vast standing army led by a professional military caste. This nationalist isolationism would remain in place until the very eve of American entry into the Second World War.