“Grand Union” or “Cambridge Flag” was first flown over Prospect Hill, overlooking Boston in January 1776 during the Siege of Boston. While never sanction by the Continental Army, it is widely believed to be the first flag of this nation.
From the History of the United States by Henry William Elson:
[The British General] Gage had been ordered to arrest Adams and Hancock, who had been elected to the Second Continental Congress, and to send them to England for trial. The two patriot leaders, fearing arrest, were at Lexington in hiding. The British general discovered their hiding place, and on the night of the 18th of April 1775, sent a body of eight hundred regulars to make the arrest and, at the same time, to move on a few miles farther and destroy the military stores at Concord. Silently in the darkness the troops were rowed across the Charles River, and by midnight they were well on the way to Lexington. Every precaution for secrecy had been taken, but the vigilance of the patriots was too keen to be eluded.
Paul Revere, one of the noblest of the Sons of Liberty, stood by the river, his steed by his side, waiting for a lantern signal from the belfry of the North Church, which would inform him of the direction the troops had taken. The signal appeared, and a moment later he was galloping through the night toward Lexington. At every door, as he dashed along, he shouted the thrilling news ride that the British were coming. Reaching Lexington, he came to the house of the Rev. Jonas Clark, where Hancock and Adams were sleeping. The door was guarded by minute- men, who warned him not to disturb the inmates with his noise. “Noise!” cried Revere, “you’ll soon have noise enough; the regulars are coming!” Hancock, at an upper window, knew his voice and invited him in; and a few hours later, when the enemy came up, the two patriots had quietly proceeded on their way to the Congress at Philadelphia.
The news of the approaching enemy sped on to Concord, and to the surrounding towns and farmhouses; and the men arose, seized their guns, and hastened to the scene of the coming conflict. Colonel Smith, in command of the English, saw but too plainly, by the flickering lights on the hills, by the sound of bells and of signal guns, that his movements were known, and he sent back to Gage for reinforcements while he dispatched Major Pitcairn forward with six companies of infantry to secure the bridge at Concord. Pitcairn reached Lexington at sunrise, and found himself confronted by some forty minutemen under Captain John Parker. With an oath he called upon them to disperse, but they stood as motionless as a wall, and he ordered his men to fire. The soldiers hesitated, and Pitcairn discharged his own pistol, and thus fired the first shot of the war of the Revolution. Again he ordered the men to fire; they now did so, and the volley laid seven of the patriots dead and ten wounded upon the village green. Parker was greatly outnumbered, and, after making a feeble resistance, ordered his men to retire. But the day’s business was only begun. The British troops hastened on to Concord and entered the town unopposed, as the minutemen, to the number of two hundred, had withdrawn to the top of the hill beyond the river, taking with them or hiding most of the cannon and stores. The regulars destroyed the little they found, cut down the liberty pole, and set fire to the courthouse. But their work came to an abrupt close. Two hundred of their number had been left to guard the North Bridge that spanned the little river near the village, and on these the patriots, now increased to four hundred, made a descent and opened fire. The firing of both sides, the river flowing between them, was brisk for some minutes and a few of each were slain. This was the first encounter after that on the greensward at Lexington some hours before.Colonel Smith now understood the peril of his position, and determined to retire. But it was already too late. The whole surrounding country was roused; the farmers and villagers swarmed to the scene, and, without a leader, without order, from every hiding place — trees, fences, thickets, and hillocks, in true Battle of Lexington- Indian fashion — they poured an incessant fire into the retreating British. The latter were not wanting in courage; they made a brave effort to retreat in order, but the retreat became a rout, and every attempt to halt and form into line was thwarted by the deadly hail of patriot bullets from every side. Many of them fell dead or dying on the road; the rout became a race with death. They had marched all the night before; the day was hot, and they were well-nigh exhausted. The whole force would have been killed or captured but for the coming of reenforcements. When they reached Lexington, they were met by Lord Percy with twelve hundred men coming to their rescue. Percy opened his ranks to admit the fugitive soldiers; and they ran in, as a hunted fox finds his den in the mountains, and fell to the ground, with their tongues hanging from their mouths in sheer exhaustion. Percy planted his cannon, and for a time held the Americans at bay; but as he began his march toward Boston they attacked him in ever increasing numbers, and the battle ceased only at nightfall when the British found shelter under the guns of the royal ships in the harbor. The British loss was 273 and the American loss 93.
Thus ended the first armed conflict of the Revolution. That night was one of intense commotion in the vicinity of Boston. The patriots did not return to their homes; they encamped on the ground, and their numbers were rapidly augmented from every hill and valley of New England. Israel Putnam of Connecticut left his plow in the furrow to lead a band of fellow-farmers to Cambridge; Benedict Arnold brought a company from New Haven; John Stark arrived from New Hampshire with twelve hundred men, and Nathanael Greene from Rhode Island with a thousand. Within a few days after the affair at Lexington and Concord, Boston was beset by an untrained army of sixteen thousand men.
So began the Siege of Boston. The Grand Union Flag was first flown the following Winter on Prospect Hill overlooking Boston. The next year sometime around July 4th 1776, the people of this new country declared its independence with one of the most famous and important documents in all of recorded history.