In 1920, the Eighteenth Amendment to the United States Constitution was enacted, creating yet another serious setback to the American wine industry. The National Prohibition Act, also known as the Volstead Act, prohibited the manufacture, sale, transportation, importation, exportation, delivery, or possession of intoxicating liquors for beverage purposes, and nearly destroyed what had become a thriving national industry. In 1920 there were more than seven hundred wineries in California. By the end of Prohibition, there were 160.
If Prohibition had lasted only four or five years, its impact on the wine industry might have been negligible. But it continued for thirteen years, during which time grapes went underground literally and figuratively, becoming an important commodity in the criminal economy. The fruit juice, which was sometimes made into concentrate, was ideal for making wine. Some of this yield found its way to bootleggers throughout America who did just that. But not for long, because the government stepped in and banned the sale of grape juice, preventing illegal wine producation. Vineyards stopped being planted, and the American wine industry ground to a halt.